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Company D is in the process of creating their static and flexible budget for their machining department. The machining department's costs are driven by the number of machine hours. Budgeting information for the department is provided below: Labor costs per machine hour           $28.00 Overhead costs per machine hour    $1.20 Plant supervisor salary                      $215,000 Straight light depreciation                  $8,000 Machine hours per unit                      2.2 hours Production volume estimate              4,000 units Actual production volume                  4,800 units What are the total costs for the static budget?

Company D is in the process of creating their static and flexible budget for their machining department. The machining department's costs are driven by the number of machine hours. Budgeting information for the department is provided below: Labor costs per machine hour           $28.00 Overhead costs per machine hour    $1.20 Plant supervisor salary                      $215,000 Straight light depreciation                  $8,000 Machine hours per unit                      2.2 hours Production volume estimate              4,000 units Actual production volume                  4,800 units What are the total costs for the static budget?

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Company D is in the process of creating their static and flexible budget for their machining department. The machining department's costs are driven by the number of machine hours. Budgeting information for the department is provided below:

  • Labor costs per machine hour           $28.00
  • Overhead costs per machine hour    $1.20
  • Plant supervisor salary                      $215,000
  • Straight light depreciation                  $8,000
  • Machine hours per unit                      2.2 hours
  • Production volume estimate              4,000 units
  • Actual production volume                  4,800 units

What are the total costs for the static budget? 

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