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inna [77]
2 years ago
6

Wu Production Company, which uses activity-based budgeting, is in the process of preparing a manufacturing overhead budget. Whic

h of the following would likely appear on that budget? Facility and general operations-level costs: Indirect material. Batch-level costs: Production setup. Product-level costs: Insurance and property taxes. Unit-level costs: Maintenance. Unit-level costs: Depreciation.
Business
1 answer:
creativ13 [48]2 years ago
6 0

Answer:

Option which would likely appear on that budget will be:

Batch level costs: production setup.

Explanation:

Here the company uses activity based budgeting is a management accounting tool which new year budget is only seen by not considering the previous year records.

 Activity based budgeting which  is  a budgeting method in which firstly the overhead costs are being calculated and the the budgets gets created.

Batch-level cost is a cost which is not associated with any given specific individual units but is associated with a group of units.

For example, to set up a production run the cost incurred is associated with the batch of goods that are produced subsequently.

Another example can be be procurement costs. The expenses associated with the procurement costs include the  ordering of direct materials, paying suppliers and receiving goods.

Since all of the expenses are related to the orders placed numbers, they must be allocated not to an individual product but to group of unit.

You might be interested in
Pigot Corporation uses job costing and has two production departments, M and A. Budgeted manufacturing costs for the year are as
zlopas [31]

Answer:

Correct option is D.

<u> $200,500 </u>

Explanation:

Manufacturing overhead = [($651,000/217,000) × $25,000] + [($417,000/834,000) × $29,000] = $89,500

Total cost associated with Job. No. 432 = $57,000 + $54,000 + $89,500 = $200,500

7 0
3 years ago
Windathon, Inc. expects sales volume totaling $500,000 for June. Data for the month follows:
ivann1987 [24]

Answer:

Here the variable cost can be computed using the following formula:

Variable cost = (Sales commissions  + Shipping expense + Miscellaneous selling expenses) ×Sales

Variable cost = (4% + 1% + 3/4%) x $500,000 = $28,750

Fixed cost = Sales manager's salary + Advertising expense + Miscellaneous selling expenses

= $30,000 + $25,000 + $2,100

= $57,100

<em>Total selling expense budget = Variable cost + Fixed cost</em>

<em>= $28,750 + $57,100 </em>

<em>= $85,850</em>

8 0
3 years ago
Cirone Inc. reported the following results from last year's operations: Sales $ 9,600,000 Variable expenses 6,810,000 Contributi
weeeeeb [17]

Answer: 8.39%

Explanation:

Margin = Net Income/ Sales

Net income for the company including the new investment:

= 864,000 + (Sales * Contribution margin ratio - Fixed costs)

= 864,000 + (4,200,000 * 30% - 966,000)

= $1,158,000

The combined sales for the company is:

= 9,600,000 + 4,200,000

= $13,800,000

Combined margin:

= 1,158,000 / 13,800,000

= 8.39%

6 0
3 years ago
A manufacturing company that produces a single product has provided the following data concerning its most recent month of opera
Sedaia [141]

Answer: $670,400

Explanation:

Period costs are not included in direct production and in this instance include:

  • Variable selling and administrative expense
  • Fixed manufacturing overhead
  • Fixed selling and administrative expense

Period costs = (12,000 * 4) + 406,400 + 216,000

= $670,400

7 0
2 years ago
Suppose there are only two firms in an economy: Cowhide, Inc. produces leather and sells it to Couches, Inc., which produces and
ratelena [41]

Answer:

$57,000

Explanation:

The calculation for GDP only takes into account the final, market value, of finished goods and services. The value of intermediate goods (those that are transformed into other goods during the year) is not taken into account.

In this case, we have 20 couches that were finished and sold for $2,600. They are part of GDP under their market value. Their total contribution to GDP is:

20 couches x $2,600 = $52,000

Cowhide, Inc. produced 25 units of leather, each worth $1,000. 20 of them were bought by Couches, Inc. and transformed into couches. As a result, those 20 units are not counted on GDP.

The remaining 5 units of leather are part of GDP because they are finished goods which have not been transformed into anythign else. Even if Couches, Inc. has promised to buy those 5 units of leather, it would only do so in 2016, and a promise is not necessarily a certainty.

The contribution of the 5 units of leather to GDP is:

5 units of leather x $1,000 = $5,000

Finally, we add up the two figures to obtain total GDP:

GDP = $52,000 + $5,000

        = $57,000

3 0
3 years ago
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