(a) Prepare a flexible budget performance report, before fixed costs)
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
![Bramble Company uses a flexible budget for manufacturing overhead based on direct labor hours. Budgeted variable manufacturing
overhead costs per direct labor hour are as follows.
Indirect labor
Indirect materials
Utilities
Budgeted fixed overhead costs per month are Supervision $3,360, Depreciation $1,008, and property Taxes $672. The company
believes it will normally operate in a range of 5,880-8,400 direct labor hours per month.
Assume that in July 2022, Bramble Company incurs the following manufacturing overhead costs.
Variable Costs
Fixed Costs
Indirect labor
Indirect materials
Utilities
$1.00
0.70
0.40
#
$7,392
Supervision
4,872
Depreciation
2,688 Property taxes
$3,360
1,008
672
(a) Prepare a flexible budget performance report, assuming that the company worked 7.560 direct labor hours during the month.
(List variable costs before fixed costs)
BRAMBLE COMPANY
Manufacturing Overhead Flexible Budget Report
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