Tempo Company's fixed budget (based on sales of 10,000 units) folllows. Fixed Budget Sales (10,000 units x $215 per unit) Costs Direct materials Direct labor Indirect materials Supervisor salary Sales commissions Shipping Administrative salaries Depreciation-Office equipment Insurance Office rent Income 2,150,000 240,000 440,000 260,000 40,000 80,000 140,000 90,000 60,000 30,000 40,000 730,000 1. Compute total variable cost per unit. 2. Compute total fixed costs. 3. Prepare a flexible budget at activity levels of 8,000 units and 12,000 units. abs below
Tempo Company's fixed budget (based on sales of 10,000 units) folllows. Fixed Budget Sales (10,000 units x $215 per unit) Costs Direct materials Direct labor Indirect materials Supervisor salary Sales commissions Shipping Administrative salaries Depreciation-Office equipment Insurance Office rent Income 2,150,000 240,000 440,000 260,000 40,000 80,000 140,000 90,000 60,000 30,000 40,000 730,000 1. Compute total variable cost per unit. 2. Compute total fixed costs. 3. Prepare a flexible budget at activity levels of 8,000 units and 12,000 units. abs below
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Concept explainers
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:Tempo Company's fixed budget (based on sales of 10,000 units) folllows.
Fixed Budget
Sales (10,000 units x $215 per unit)
Costs
Direct materials
Direct labor
Indirect materials
Supervisor salary
Sales commissions
Shipping
Administrative salaries
Depreciation-Office equipment
Insurance
Office rent
Income
1. Compute total variable cost per unit.
2. Compute total fixed costs.
3. Prepare a flexible budget at activity levels of 8,000 units and 12,000 units.
Required 1 Required 2 Required 3
2,150,000
Complete this question by entering your answers in the tabs below.
Compute total variable cost per unit.
240,000
440,000
260,000
40,000
80,000
140,000
90,000
60,000
30,000
40,000
730,000
Total variable cost per unit
Required 2 >
Transcribed Image Text:Tempo Company's fixed budget (based on sales of 10,000 units) folllows.
Fixed Budget
Sales (10,000 units x $215 per unit)
Costs
Direct materials
Direct labor
Indirect materials
Supervisor salary
Sales commissions
Shipping
Administrative salaries
Depreciation-Office equipment
Insurance
Office rent
Income
Required 1 Required 2
1. Compute total variable cost per unit.
2. Compute total fixed costs.
3. Prepare a flexible budget at activity levels of 8,000 units and 12,000 units.
Compute total fixed costs.
Complete this question by entering your answers in the tabs below.
Total fixed costs
Variable costs
2,150,000
Required 3
Fixed costs
240,000
440,000
260,000
40,000
80,000
140,000
< Required 1
90,000
60,000
30,000
40,000
730,000
< Required 2
Prepare a flexible budget at activity levels of 8,000 units and 12,000 units.
TEMPO COMPANY
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Flexible Budget
Variable Amount Total Fixed
per Unit
Cost
Required 3 >
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Flexible Budget for:
Units Sales Unit Sales of
of 8,000
12,000
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