Prepare the company's flexible budget for August.
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Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
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- B. Cleanexstar provides a cleaning service for small offices. Cleanexstar calculates a predetermined overheads rate based on total direct labor hours. The budgeted overhead cost for Cleanexstar is RM520,000. The following related information is provided for direct labor hours. Estimated hour per worker 2,000 Number of workers 25 You are required to calculate: i) Total direct labour hours ii) Predetermined overhead rate iii) The actual direct labour hours for Client A are 144 hours. Calculate the overheads absorbed into Client A.Tasman Products, Limited, of Australia has a Maintenance Department that services the equipment in the company’s Forming Department and Assembly Department. The cost of this servicing is charged to the operating departments on the basis of machine-hours. Cost and other data relating to the Maintenance Department and to the other two departments for the most recent year are presented below. Data for the Maintenance Department follow: Budget Actual Variable costs for lubricants $ 355,200* $ 455,760 Fixed costs for salaries and other $ 216,000 $ 232,600 *Budgeted at $24 per machine-hour. Data for the Forming and Assembly Departments follow: Percentage of Peak-Period Capacity Required Machine-Hours Budget Actual Forming Department 63% 9,800 11,800 Assembly Department 37% 5,000 4,000 Total 100% 14,800 15,800 The level of fixed costs in the Maintenance Department is determined by peak-period requirements. Required: 1. How much Maintenance…Cleanexstar provides a cleaning service for small offices. Cleanexstar calculates a predetermined overheads rate based on total direct labour hours. The budgeted overhead cost for Cleanexstar is RM520,000. The following related information is provided for direct labour hours. Estimated hour per worker 2,000 Number of worker 25 i) Total direct labour hours ii) Predetermined overhead rate
- The following data pertain to the Oneida restaurant Supply Company for the year just ended:Budget sales revenue645000OMRBudgeted manufacturing overhead403000OMRBudgeted machine hours18000hoursActual manufacturing overhead487000OMRActual machine hours14000hours Required:Calculate the overapplied or underapplied overhead for the year using machine hours as a driverCleanexstar provides a cleaning service for small offices. Cleanexstar calculates a predetermined overheads rate based on total direct Jabour hours. The budgeted overhead cost for Cleanexstar is RM520,000. The following related information is provided for direct labour hours. Estimated hour per worker 2,000 25 Number of workerTasman Products, Limited, of Australia has a Maintenance Department that services the equipment in the company's Forming Department and Assembly Department. The cost of this servicing is charged to the operating departments on the basis of machine- hours. Cost and other data relating to the Maintenance Department and to the other two departments for the most recent year are presented below. Data for the Maintenance Department follow: Variable costs for lubricants Fixed costs for salaries and other "Budgeted at $20 per machine-hour. Data for the Forming and Assembly Departments follow: Forming Department Assembly Department Total Budget $ 312,000 $ 206,000 Percentage of Peak- Period Capacity Required 73% 27% 100% Actual $ 399,600 $ 221,600 Machine-Hours Budget 10,400 5,200 15,600 Actual 12,400 4,200 16,600 The level of fixed costs in the Maintenance Department is determined by peak-period requirements. Required: 1. How much Maintenance Department cost should be charged to the Forming…
- Tasman Products, Limited, of Australia has a Maintenance Department that services the equipment in the company’s Forming Department and Assembly Department. The cost of this servicing is charged to the operating departments on the basis of machine-hours. Cost and other data relating to the Maintenance Department and to the other two departments for the most recent year are presented below. Data for the Maintenance Department follow: Budget Actual Variable costs for lubricants $ 96,000* $ 110,000 Fixed costs for salaries and other $ 150,000 $ 153,000 *Budgeted at $0.40 per machine-hour. Data for the Forming and Assembly Departments follow: Percentage of Peak-Period Capacity Required Machine-Hours Budget Actual Forming Department 70% 160,000 190,000 Assembly Department 30% 80,000 70,000 Total 100% 240,000 260,000 The level of fixed costs in the Maintenance Department is determined by peak-period requirements. Required: Using the above data, describe…At the end of the first month of opening your business, you calculate the actual operating costs of the business and the income you earned. You also notice and document the difference in what you budgeted for certain materials and labor against the actual amounts you spent on the same. For your statement of cost of goods sold, use the following data regarding the actual costs incurred by the business over the past month: Materials purchased: $20,000 Consumed 80% of the purchased materials Direct labor: $8,493.33 Overhead costs: $3,765 Note: Assume that the beginning materials and ending work in process are zero for the month. Use the following revenue and cost information for the income statement. Note that the revenue you use will depend on the pricing level options you chose in Milestone Two. Also, assume that after accounting for weekends and other holidays, there were 20 business days in the first month of operation. For example, if you chose a sales price of $20 per collar,…A manufacturer uses activity-based costing to assign overhead costs to products. Budgeted cost information for selected activities for next year follows. Activity Purchasing Cleaning factory Providing utilities Activity cost pool Purchasing Factory Expected Cost $127,600 31,500 63,070 Expected Costs Compute activity rates for each of the cost pools. (Round your answers to 2 decimal places.) Expected Amount of Cost Driver Cost Driver Purchase orders Square feet Square feet 4,400 4,900 Activity Overhead Rate Expected Usage of Cost Driver 4,488 purchase orders 4,900 square feet 4,900 square feet per purchase order per square foot
- As the firm’s accountant you are required to write a report explaining your general approach to the use of cost accounts and in particular the problems of overhead costing. The company has two producing departments, machining and assembly, and one service department, the canteen. Direct departmental overhead for the coming year is estimated as machining K50,000, assembly K40,000 and canteen K10,000. Details of estimated indirect overhead are as follows: Rates K1,000 Depreciation K9,500 Light and power K600 DEPARTMENTAL DATA No. of Cost of Kilowatt hours employees equipment square feet Machining 600 20 K10,000…The accounting department of a large limousine company is analyzing the costs of its services. The cost data and level of activity for the past 16 months follow. Month Special Analyses CustomerAccounts PaychecksProcessed AccountingService Costs 1 1 190 1,100 $ 58,800 2 1 260 1,010 61,600 3 2 270 1,170 59,200 4 2 250 920 59,100 5 3 160 1,280 60,600 6 2 170 1,180 61,900 7 1 340 830 59,000 8 4 220 1,220 61,400 9 3 150 1,210 61,300 10 1 230 1,270 60,100 11 2 220 1,130 60,200 12 2 300 930 61,200 13 3 190 1,010 59,700 14 3 290 1,120 60,700 15 4 300 910 60,500 16 2 180 980 60,200 Totals 36 3,720 17,270 $ 965,500 In addition to the above information, you learn that the accounting department had the following total…The controller of Ferrence Company estimates the amount of materials handling overhead cost that should be allocated to the company's two products using the data that are given below: The total materials handling cost for the year is expected to be $16,486.40. If the materials handling cost is allocated on the basis of material moves, how much of the total materials handling cost should be allocated to the specialty windows? (Round off your answer to the nearest whole dollar.) Question 12 options: $3,266 $9,274 $8,243 $6,595