Hamov Torter makes cakes, for which the budgeted costs and profit per unit is as follows: $ Materials Labour 3 Variable production overheads 3 Fixed production overheads 4 Viariable selling cost 1 Fexed selling overhead 2 Profit 5 Selling price 20 Both types of fixed overheads were based on budget of 10,000 cakes a year In the fist year of production, the only difference from the budget was that 11,000 cakes were produced, and 9,000 sold. All costs and revenues are in line with budged per unit. Calculate the profit made under absorption costing system a. $ 12,000 b. $ 1,000 C. $12 d. $ 47,000 2
Hamov Torter makes cakes, for which the budgeted costs and profit per unit is as follows: $ Materials Labour 3 Variable production overheads 3 Fixed production overheads 4 Viariable selling cost 1 Fexed selling overhead 2 Profit 5 Selling price 20 Both types of fixed overheads were based on budget of 10,000 cakes a year In the fist year of production, the only difference from the budget was that 11,000 cakes were produced, and 9,000 sold. All costs and revenues are in line with budged per unit. Calculate the profit made under absorption costing system a. $ 12,000 b. $ 1,000 C. $12 d. $ 47,000 2
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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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.
Question
ll.2
Transcribed Image Text:Hamov Torter makes cakes, for which the budgeted costs and profit per unit is as follows:
$
Materials
Labour 3
Variable production overheads 3
Fixed production overheads 4
Viariable selling cost
1
Fexed selling overhead 2
Profit 5
Selling price 20
Both types of fixed overheads were based on budget of 10,000 cakes a year
In the fist year of production, the only difference from the budget was that 11,000 cakes were produced, and
9,000 sold. All costs and revenues are in line with budged per unit.
Calculate the profit made under absorption costing system
a.
$ 12,000
b.
$ 1,000
C.
$ 12
d.
$ 47,000
2
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