Acme Company's production budget for August is 18,200 units and includes the following component unit costs: direct materials, $8.00; direct labor, $10.70; variable overhead, $6.70. Budgeted fixed overhead is $39,000. Actual production in August was 19,440 units. Required: Prepare a flexible budget that would be used to compare against actual production costs for August. Note: Round "Cost per unit" to 2 decimal places. Direct materials Direct labor Variable overhead Cost Formula Original Budget (18,200 units) Flexed Budget (19,440 units)
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.
![Acme Company's production budget for August is 18,200 units and includes the following component unit
costs: direct materials, $8.00; direct labor, $10.70; variable overhead, $6.70. Budgeted fixed overhead is
$39,000. Actual production in August was 19,440 units.
Required:
Prepare a flexible budget that would be used to compare against actual production costs for August.
Note: Round "Cost per unit" to 2 decimal places.
Direct materials
Direct labor
Variable overhead
Fixed overhead
Total budgeted cost
Cost Formula
Original Budget
(18,200 units)
$
0
Flexed Budget
(19,440 units)
$
0](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F2f04870c-fd4e-4f56-b4fd-eac8c2d1a203%2Fa7a9c6f4-a18b-44c8-8135-75dbc1c9da6d%2F47r6dkh_processed.png&w=3840&q=75)
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