Question

Blossom, Inc. prepared the following master budget items for July:

   

Production and sales		28,000	units
Variable manufacturing costs:
Direct materials	$	28,000
Direct labor	$	61,000
Variable manufacturing overhead	$	42,000
Fixed manufacturing costs	$	130,000
Total manufacturing costs	$	261,600

   

During July, Blossom actually sold 34,000 units. Prepare a flexible budget for Blossom based on actual sales. (Do not round your intermediate calculations.)
Production and Sales		UNITS
Variable manufacturing costs
Direct materials
Direct labor
Variable manufacturing overhead
Fixed manufacturing costs
Total manufacturing costs

Answer 1

we will adjust variable cost as per the actual units. fixed costs will remain same.

flexible budget for Blossom for July
Production and Sales	34,000	UNITS
Variable manufacturing costs
Direct materials	$34,000	[$28,000/28,000units]*34,000
Direct labor	$74,071	[$61,000/28,000]*34,000
Variable manufacturing overhead	$51,000	[$42,000/28,000]*34,000
Fixed manufacturing costs	$130,000
Total manufacturing costs	$289,071	[$34,000+74,071+51,000+130,000]

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