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A division manager at the Erlinda Corporation is interested in a flexible rcise 4-30 pudget for factory overhead, selling & administrative expeses for at least three jevels of operating activity (40,000 units, 60,000 units, and 100,000 units). Costs Spoilage is to be treated as factory overhead. Labor costs are P75.00 definitely fixed in the amount of PS0,000 are the depreciation of machinery and Material costs are PI0.00 per unit with spoilage averaging 2%a of hour with 12 hours required to produce 20 units. 10% of the labor costs is Other expenses which generally were considered wholly variable yet seem equipment. PI0.00. per indirect labor. fixed component are: a to possess At 30,000 units of production Supervision Factory heat, light &power Maintenance, machinery Indirect materials Miscellaneous overhead Sales commission Office supplies Miscellaneous selling & administrative expenses Total production has never exceeded 100,000 units in any one month. At 80,000 units P25,000 of production 19,200 P40,000 31,200 6,000 5,000 15,000 10,000 5,000 15,000 12,000 9,000 40,000 18,000 35,000 80,000 1. Using the high-low technique, split the 8 seemingly semi-variables into their fixed and variable segments REQUIRED:

A division manager at the Erlinda Corporation is interested in a flexible rcise 4-30 pudget for factory overhead, selling & administrative expeses for at least three jevels of operating activity (40,000 units, 60,000 units, and 100,000 units). Costs Spoilage is to be treated as factory overhead. Labor costs are P75.00 definitely fixed in the amount of PS0,000 are the depreciation of machinery and Material costs are PI0.00 per unit with spoilage averaging 2%a of hour with 12 hours required to produce 20 units. 10% of the labor costs is Other expenses which generally were considered wholly variable yet seem equipment. PI0.00. per indirect labor. fixed component are: a to possess At 30,000 units of production Supervision Factory heat, light &power Maintenance, machinery Indirect materials Miscellaneous overhead Sales commission Office supplies Miscellaneous selling & administrative expenses Total production has never exceeded 100,000 units in any one month. At 80,000 units P25,000 of production 19,200 P40,000 31,200 6,000 5,000 15,000 10,000 5,000 15,000 12,000 9,000 40,000 18,000 35,000 80,000 1. Using the high-low technique, split the 8 seemingly semi-variables into their fixed and variable segments REQUIRED:

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Factory heat, light & power Factory heat, light & power 142 Erlinda Corporation Elexible Overhead Budget, Division 1 For the Month of January, 2021 Fixed overhead: Depreciation, machinery 40,000 U Supervision 60,000 U 100,000 U Maintenance, machinery Indirect materials Miscellaneous overhead Variable overhead: Materials spoilage Indirect labor Supervision Total Maintenance, machinery Indirect materials Miscellaneous overhead Total Total factory overhead Erlinda Corporation Elexible Selling & Administrative Expenses Budget, Division 1 For the Month of January, 2021 40,000 U 60,000 U 100,000 U Fixed expenses: Sales & office salaries Office supplies Miscellaneous S & A expenses Total Variable expenses: Sales commission Office supplies Miscellaneous S & A expenses Total Total selling & administrative expenses
Transcribed Image Text:Factory heat, light & power Factory heat, light & power 142 Erlinda Corporation Elexible Overhead Budget, Division 1 For the Month of January, 2021 Fixed overhead: Depreciation, machinery 40,000 U Supervision 60,000 U 100,000 U Maintenance, machinery Indirect materials Miscellaneous overhead Variable overhead: Materials spoilage Indirect labor Supervision Total Maintenance, machinery Indirect materials Miscellaneous overhead Total Total factory overhead Erlinda Corporation Elexible Selling & Administrative Expenses Budget, Division 1 For the Month of January, 2021 40,000 U 60,000 U 100,000 U Fixed expenses: Sales & office salaries Office supplies Miscellaneous S & A expenses Total Variable expenses: Sales commission Office supplies Miscellaneous S & A expenses Total Total selling & administrative expenses
per hour with 12 hours required to produce 20 units. 10% of the labor costs is P10.00. Spoilage is to be treated as factory overhead. Labor costs are P75.00 definitely fixed in the amount of P50,000 are the depreciation of machinery and Jevels of operating activity (40,000 units, 60,000 units, and 100,000 units). Costs budget for factory overhead, selling & administrative expenIses for at least three Other expenses which generally were considered wholly variable yet seem A division manager at the Erlinda Corporation is interested in a flexible Material costs are P10.00 per unit with spoilage averaging 2% of 146 Exercise 4-30 GOLO 482 equipment. indirect labor At 30,000 units Supervision Factory heat, light &power Maintenance, machinery Indirect materials Miscellaneous overhead Sales commission Office supplies Miscellaneous selling & administrative expenses Total production has never exceeded 100,000 units in any one month. of production At 80,000 units P25,000 of production 19,200 P40,000 31,200 15,000 10,000 9,000 40,000 18,000 6,000 5,000 5,000 15,000 12,000 35,000 80,000 REQUIRED: Rising the high-low technique, split the 8 seemingly semi-variables into their fixed and variable segments. 2 Prepare a flexible budget for selling & administrative expenses for the first month of 2021. Fixed 30,000 units 80,000 units Cost Variable Difference rate/unit I5 000 12,000 Supervision Factory heat, light & power Maintenance, machinery Indirect materials Miscellaneous overhead Sales commission Office supplies Miscellaneous S& A expenses 9.000 .000 4000 25.000 4.000 45,000
Transcribed Image Text:per hour with 12 hours required to produce 20 units. 10% of the labor costs is P10.00. Spoilage is to be treated as factory overhead. Labor costs are P75.00 definitely fixed in the amount of P50,000 are the depreciation of machinery and Jevels of operating activity (40,000 units, 60,000 units, and 100,000 units). Costs budget for factory overhead, selling & administrative expenIses for at least three Other expenses which generally were considered wholly variable yet seem A division manager at the Erlinda Corporation is interested in a flexible Material costs are P10.00 per unit with spoilage averaging 2% of 146 Exercise 4-30 GOLO 482 equipment. indirect labor At 30,000 units Supervision Factory heat, light &power Maintenance, machinery Indirect materials Miscellaneous overhead Sales commission Office supplies Miscellaneous selling & administrative expenses Total production has never exceeded 100,000 units in any one month. of production At 80,000 units P25,000 of production 19,200 P40,000 31,200 15,000 10,000 9,000 40,000 18,000 6,000 5,000 5,000 15,000 12,000 35,000 80,000 REQUIRED: Rising the high-low technique, split the 8 seemingly semi-variables into their fixed and variable segments. 2 Prepare a flexible budget for selling & administrative expenses for the first month of 2021. Fixed 30,000 units 80,000 units Cost Variable Difference rate/unit I5 000 12,000 Supervision Factory heat, light & power Maintenance, machinery Indirect materials Miscellaneous overhead Sales commission Office supplies Miscellaneous S& A expenses 9.000 .000 4000 25.000 4.000 45,000
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