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Flexing budgets

Forums › Ask ACCA Tutor Forums › Ask the Tutor ACCA PM Exams › Flexing budgets

  • This topic has 3 replies, 2 voices, and was last updated 8 years ago by John Moffat.
Viewing 4 posts - 1 through 4 (of 4 total)
  • Author
    Posts
  • December 2, 2017 at 11:06 am #419638
    sheri12
    Member
    • Topics: 19
    • Replies: 15
    • ☆

    Kaplan Text book, Budgeting, Test your understanding 14

    A company manufactures cell phones and has developed a new cell phone called “H”. The max production capacity is 150000 units, management accountant is preparing an annual flexible budget
    “000 “000 “000
    Production(units) 100 120 150
    Mat costs$ 700 840 1050
    Lab costs 750 900 1125
    Incremental fix costs 60 60 60

    What would be the flexed budget total production cost if production cost if production is 90% of maximum capacity?

    The only part of this that I didn’t understood how to deal with incremental fixed costs kindly help please

    December 2, 2017 at 3:28 pm #419693
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54829
    • ☆☆☆☆☆

    The fixed costs will remain at 60, by definition they will stay fixed.

    December 2, 2017 at 3:36 pm #419696
    sheri12
    Member
    • Topics: 19
    • Replies: 15
    • ☆

    Thanks but if you see the solution their is Stepped supervisor costs God knows from where this cost is taken !

    December 2, 2017 at 5:03 pm #419741
    John Moffat
    Keymaster
    • Topics: 57
    • Replies: 54829
    • ☆☆☆☆☆

    I do not have the Kaplan text book and so without seeing the whole question I am unable to help.

  • Author
    Posts
Viewing 4 posts - 1 through 4 (of 4 total)
  • The topic ‘Flexing budgets’ is closed to new replies.

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