Dakota Co. has prepared the following flexible budget for the coming year. The budgeted level of activity is 5,000 units. Sales Direct material Direct labour Variable overheads Fixed overheads Profit £ 125,000 37,500 30,000 15,000 20,000 22,500 If the budget is flexed to a level of activity of 7,500 units, what would be the budgeted total costs be? a) £102,500 b) £110,000 c) £143,750 d) £126,000
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.
Dakota Co. has prepared the following flexible budget for the coming year. The budgeted level of activity is 5,000 units.
Sales
Direct material Direct labour Variable
£ 125,000 37,500 30,000 15,000 20,000 22,500
If the budget is flexed to a level of activity of 7,500 units, what would be the budgeted total costs be?
-
a) £102,500
-
b) £110,000
-
c) £143,750
-
d) £126,000
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