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DasToe Inc. (TI) is a manufacturer of heating elements for toaster ovens. To improve control over operations, the president wants to stall a flexible budgeting system, rather than the single master budget being used at present. The following data are available for Expected costs for production. The relevant range of production levels for fixed overhead costs is 75,000 to 170,000 units: Variable costs: Manufacturing Administrative Selling Fixed costs: Manufacturing Administrative $6.50/unit $3.50/unit $1.50/unit $ 112,400 $ 85,000 Required: Prepare a flexible budget for each of the three possible sales levels: 94,000, 104,000, and 114,000 units. Each toaster oven expected to sell for $13.60. TOASTTOE INC.

DasToe Inc. (TI) is a manufacturer of heating elements for toaster ovens. To improve control over operations, the president wants to stall a flexible budgeting system, rather than the single master budget being used at present. The following data are available for Expected costs for production. The relevant range of production levels for fixed overhead costs is 75,000 to 170,000 units: Variable costs: Manufacturing Administrative Selling Fixed costs: Manufacturing Administrative $6.50/unit $3.50/unit $1.50/unit $ 112,400 $ 85,000 Required: Prepare a flexible budget for each of the three possible sales levels: 94,000, 104,000, and 114,000 units. Each toaster oven expected to sell for $13.60. TOASTTOE INC.

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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basToe Inc. (TI) is a manufacturer of heating elements for toaster ovens. To improve control over operations, the president wants to nstall a flexible budgeting system, rather than the single master budget being used at present. The following data are available for xpected costs for production. The relevant range of production levels for fixed overhead costs is 75,000 to 170,000 units: Variable costs: Manufacturing Administrative Selling Fixed costs: Manufacturing Administrative $6.50/unit $3.50/unit $1.50/unit $ 112,400 $ 85,000 Required: Prepare a flexible budget for each of the three possible sales levels: 94,000, 104,000, and 114,000 units. Each toaster oven is expected to sell for $13.60. TOASTTOE INC.
Transcribed Image Text:basToe Inc. (TI) is a manufacturer of heating elements for toaster ovens. To improve control over operations, the president wants to nstall a flexible budgeting system, rather than the single master budget being used at present. The following data are available for xpected costs for production. The relevant range of production levels for fixed overhead costs is 75,000 to 170,000 units: Variable costs: Manufacturing Administrative Selling Fixed costs: Manufacturing Administrative $6.50/unit $3.50/unit $1.50/unit $ 112,400 $ 85,000 Required: Prepare a flexible budget for each of the three possible sales levels: 94,000, 104,000, and 114,000 units. Each toaster oven is expected to sell for $13.60. TOASTTOE INC.
Variable costs: Manufacturing Administrative Selling Total variable costs Contribution margin Fixed costs: Manufacturing Administrative Total fixed costs Total costs Income from operations TOASTTOE INC. Flexible Budget Cost Formula (per toaster) $ 0.00 $ $ SA 94,000 Activity (toasters) 0 $ 0 $ 0 $ 104,000 0$ 0 $ 0 $ 114,000 0
Transcribed Image Text:Variable costs: Manufacturing Administrative Selling Total variable costs Contribution margin Fixed costs: Manufacturing Administrative Total fixed costs Total costs Income from operations TOASTTOE INC. Flexible Budget Cost Formula (per toaster) $ 0.00 $ $ SA 94,000 Activity (toasters) 0 $ 0 $ 0 $ 104,000 0$ 0 $ 0 $ 114,000 0
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