Pharoah Company expects to produce 1.260,000 units of product XX in 2022. Monthly production is expected to range from 83.300 to 115,900 units. Budgeted variable manufacturing costs per unit are as follows: direct materials $4, direct labour $7, and overhead $11. Budgeted fixed manufacturing costs per unit for depreciation are $6 and for supervision $3. In March 2022, the company incurs the following costs in producing 99.600 units: direct materials $425,400, direct labour $687,200, and variable overhead $1.104,600. Actual fixed overhead equalled budgeted fixed overhead. Prepare a flexible budget report for March (List variable costs before fixed costs.)
Pharoah Company expects to produce 1.260,000 units of product XX in 2022. Monthly production is expected to range from 83.300 to 115,900 units. Budgeted variable manufacturing costs per unit are as follows: direct materials $4, direct labour $7, and overhead $11. Budgeted fixed manufacturing costs per unit for depreciation are $6 and for supervision $3. In March 2022, the company incurs the following costs in producing 99.600 units: direct materials $425,400, direct labour $687,200, and variable overhead $1.104,600. Actual fixed overhead equalled budgeted fixed overhead. Prepare a flexible budget report for March (List variable costs before fixed costs.)
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.
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Transcribed Image Text:Pharoah Company expects to produce 1.260,000 units of product XX in 2022. Monthly production is expected to range
from 83,300 to 115,900 units. Budgeted variable manufacturing costs per unit are as follows: direct materials $4, direct labour $7, and
overhead $11. Budgeted fixed manufacturing costs per unit for depreciation are $6 and for supervision $3.
In March 2022, the company incurs the following costs in producing 99,600 units: direct materials $425,400, direct labour $687,200.
and variable overhead $1.104,600. Actual fixed overhead equalled budgeted fixed overhead.
Prepare a flexible budget report for March (List variable costs before fixed costs.)
Budget
PHAROAH COMPANY
Manufacturing Flexible Budget Report
Actual
Difference
Favourable
Unfavourabl
Neither Favouri
nor Unfavoura
E
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