Mc-Cordy Company provided information on the following three overhead activities: Activity Variable rate Maintenance Power Setting up Driver Machine hours Fixed cost R75 000 Machine hours Setups R20 000 R1.50 R2.05 R1 500.00 Mc-Cordy has found that the following driver levels are associated with two different levels of production: Driver Machine hours Setups 30 000 units 50.000 70 000 units 95 000 25 65 Required: 2.1 Prepare an activity-based flexible budget. (15) ers

Principles of Accounting Volume 2
19th Edition
ISBN:9781947172609
Author:OpenStax
Publisher:OpenStax
Chapter6: Activity-based, Variable, And Absorption Costing
Section: Chapter Questions
Problem 8EA: Rex Industries has identified three different activities as cost drivers: machine setups, machine...
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Mc-Cordy Company provided information on the following three overhead activities:
Activity
Variable rate
Maintenance
Power
Setting up
Driver
Machine hours
Fixed cost
R75 000
Machine hours
Setups
R20 000
R1.50
R2.05
R1 500.00
Mc-Cordy has found that the following driver levels are associated with two different levels of
production:
Driver
Machine hours
Setups
30 000 units
50.000
70 000 units
95 000
25
65
Required:
2.1
Prepare an activity-based flexible budget.
(15)
ers
Transcribed Image Text:Mc-Cordy Company provided information on the following three overhead activities: Activity Variable rate Maintenance Power Setting up Driver Machine hours Fixed cost R75 000 Machine hours Setups R20 000 R1.50 R2.05 R1 500.00 Mc-Cordy has found that the following driver levels are associated with two different levels of production: Driver Machine hours Setups 30 000 units 50.000 70 000 units 95 000 25 65 Required: 2.1 Prepare an activity-based flexible budget. (15) ers
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