Question

Prepare a flexible budget for a production level at 80% and 100%:

Production at 50% capacity, 5000 units

Raw Materials Rs. 80 per unit

Direct Labour Rs. 50 per unit

Variable Expenses Rs. 10 per unit

Factory Over head Rs. 50,000 (50% fixed)

Office Overhead Rs. 60,000 (40% fixed)​

Answer 1

Answer:

Flexible Budget at a Capacity of

Capacity of

Output Units 50%

5,000 80%

8,000 100%

10,000

$ $ $

Raw Material 4,00,000 6,40,000 8,00,000

Labor 2,50,000 40,000 50,000

Direct Expenses 75,000 1,20,000 1,50,000

Prime Cost 7,25,000 11,60,000 14,50,000

Factory Expenses 50% fixed (50,000) 25,000 40,000 50,000

Factory Cost 7,75,000 12,25,000 15,25,000

Admin Expenses fixed 40% (60,000) 24,000 24,000 24,000

Variable 60% 36,000 57,600 72,000

Total Cost 8,35,000 13,06,000 16,21,

Explanation:

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