Question

Grundy company expects to produce 1,200,00 units of product xx in 2017. Monthly production is expected to range from 80,000 to 120,000 units. budgets variable manufacturing costs per unit are direct materials $5, direct labor $6, and overhead $8. budgeted fixed manufacturing cost per unit for depreciation are $2 and for supervision are $1. Prepare a flexible manufacturing budget for the relevant range value using 20,000 unit increments.

This is the question form the book can you please answer?

Answer 1

Flexible Manufacturing budget for Grundy Company

Unit level	80,000	100,000	120,000
Direct material @5/unit	400,000	500,000	600,000
Direct labor @6/unit	480,000	600,000	720,000
Over head @8/unit	640,000	800,000	960,000
Total Variable Cost	15,20,000	19,00,000	22,80,000
Depreciation @2/unit	160,000	200,000	240,000
Supervision @1/unit	80,000	100,000	120,000
Total Fixed Cost	240,000	300,000	360,000
TOTAL COST	17,60,000	22,00,000	26,40,000