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A fimm uses flexible budgets Last period the fored budget was to produce 5,500 units and the actual production was 5,000 units. The actual direct costs for the penod compared to the flexed budget was
Actual result
$60,000
Total variance
Direct costs
$5,000 Favourable
What was the direct costs fixed budget for last period?
$55,000
$65,000
$60,500
$71,500
Please help me solve this question many people answer me but everyone give different answers
Why on earth are you attempting questions for which you do not have an answer? You should be using a Revision Kit from one of the ACCA Approved Publishers – it has answers and explanations.
Given the wording of the question, the flexed budget must have been for a total of $65,000.
Given that the flexed budget was for 5,000 units, the must have been budgeting on 65,000/5,000 = $13 per units.
So the fixed budget must have been for 5,000 x $13 = $65,000.
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