output 10000 units.
material $35.000
labour $43.000
overhead $50.000
total cost $128.000.
Material cost is variable and overhead costs are fixed up to 20.000 units. labour cost includes a supervisor's fixed salary of $11000 and the remainder is variable.
What is the budget total cost for an output of 15.000 units?
$150,500
$161,500
$167,000
$192,000?
ACCA Forums
MABudget Materials output
Answer Is 161,500
Work it one by one...
first is material and it says its totally variable so get the cost per unit for it 35000/10000=3.5
labour it says there is a fixed and a variable element to it..we know the fixed is 11000 and we can get variable by subtracting fixed from 43000 to get 32000 and per unit would be 32000/10000=3.2
lastly the overheads it says are fixed totally up to 20000 units so nothing changes there
Now we can work for the asked units which are 15000
so material 15000*3.5=
labour 15000*3.2 + the fixed 11000
overheads doesnt change since they are fixed 50000
add them up
Thanks !!!
Sign into reply to this topic.