what are the flexible budget formula, Cost Accounting

Assignment Help:

Question:

Timothy Ltd uses a flexible budget for overhead costs. The company expects to produce 40,000 units of the product it manufactures. Each unit requires 0.40 direct labour hours. The cost formulas for each of the four overhead items (where X is measured in direct labour hours) are as follows:

Cost item:

Cost formula

Power

0.40X

Maintenance

$15,000 + 0.60X

Indirect labour

$18,000 + 2.50X

Rent

$20,000

(A) What are the flexible budget formulae for Willoughby Ltd?

(B) Prepare an overheads budget for the expected activity level for the coming year. Show each expense item separately with subtotals for variable and fixed overhead.

(C) Prepare an overheads budget that reflects production that is 25% lower than expected.

(D) In what way are flexible budgets different from static budgets? Why are flexible budgets better than static budgets for assessing performance?

 


Related Discussions:- what are the flexible budget formula

Wages and salaries, Given the information that follows, prepare a cash budg...

Given the information that follows, prepare a cash budget for the XYZ Store for the first six months of 2010. All prices and costs remain constant. Sales are 90% for cre

Cvp and computer applications, CVP and Computer Applications The broad...

CVP and Computer Applications The broad availability of personal computers encourages more managers to apply cost volume profit analysis. Computers can quickly create the comp

EOQ , formula for economic order quantity

formula for economic order quantity

Find the predetermined overhead rate, Forbes Company uses a predetermined o...

Forbes Company uses a predetermined overhead rate based on direct labor-hours to apply manufacturing overhead to jobs. At the beginning of the period, the company estimated manufac

Conceptual Frame work, What are the dependent and independent variables in ...

What are the dependent and independent variables in Cost Accounting??

Current funding availability, 1. The Initial Borrowings required are determ...

1. The Initial Borrowings required are determined by the amount required to start  the project less the Cash Invested by the Corporation.  The loans will always be principle & inte

Uses of cost volume profit analysis, USES O F CVP ANALYSIS 1. .It ...

USES O F CVP ANALYSIS 1. .It allows preparation of flexible budgets. 2. It provides help in forecasting accurate profit. 3. It aids in formulating price policy. 4

Calculate- total variable cost and average variable cost, The firm currentl...

The firm currently uses 50,000 workers to produce 200,000 units of output per day. The daily wage per worker is $80, and the price of the firm’s output is $25. The cost of other va

Labour, what is rowan incentive system

what is rowan incentive system

The fixed overhead price variance, DEF Municipality uses a standard absorpt...

DEF Municipality uses a standard absorption costing system to control the cost of one of its services, namely the supply of water to its constituents. The fixed budget for the reti

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd