The following data relates to a company's operating budget for its next operating year: Sales price per unit (E) 11 Sales volume (units) 90.000 Costs: Materials (E) 52.500 Labour (E) 33,800 Energy (E) 25,000 Depreciation (E) 105,000 The budget has been prepared using the following assumptions: Materials costs are variable. Labour costs are semi-variable with a fixed element of E15.000 Depreciation is a fixed cost An allowance for an energy price increase of 13% has already been included in the energy costs. The company now wishes to revise the data to incorporate the following updated assu tions: Selling prices will be reduced by 7% The sales volume will increase by 6% The rise in the energy prices should be revised to 6% What will be the company's new energy cost for the year?

The following data relates to a company's operating budget for its next operating year: Sales price per unit (E) 11 Sales volume (units) 90.000 Costs: Materials (E) 52.500 Labour (E) 33,800 Energy (E) 25,000 Depreciation (E) 105,000 The budget has been prepared using the following assumptions: Materials costs are variable. Labour costs are semi-variable with a fixed element of E15.000 Depreciation is a fixed cost An allowance for an energy price increase of 13% has already been included in the energy costs. The company now wishes to revise the data to incorporate the following updated assu tions: Selling prices will be reduced by 7% The sales volume will increase by 6% The rise in the energy prices should be revised to 6% What will be the company's new energy cost for the year?

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter10: Cost Analysis For Management Decision Making

Section: Chapter Questions

Problem 6E: The fixed overhead budgeted for Ranier Industries at an expected capacity of 500,000 units is...

See similar textbooks

Similar questions

Using High-Low to Calculate Predicted Total Variable Cost and Total Cost for Budgeted Output Refer to the information for Speedy Petes above. Assume that this information was used to construct the following formula for monthly delivery cost. TotalDeliveryCost=41,850+(12.00NumberofDeliveries) Required: Assume that 3,000 deliveries are budgeted for the following month of January. Use the total delivery cost formula for the following calculations: 1. Calculate total variable delivery cost for January. 2. Calculate total delivery cost for January.
Variable Cost Ratio, Contribution Margin Ratio Chillmax Company plans to sell 3,500 pairs of shoes at 60 each in the coming year. Unit variable cost is 21 (includes direct materials, direct labor, variable factory overhead, and variable selling expense). Fixed factory overhead is 30,000 and fixed selling and administrative expense is 48,000. Required: 1. Calculate the variable cost ratio. 2. Calculate the contribution margin ratio. 3. Prepare a contribution margin income statement based on the budgeted figures for next year. In a column next to the income statement, show the percentages based on sales for sales, total variable cost, and total contribution margin.
The fixed overhead budgeted for Ranier Industries at an expected capacity of 500,000 units is 1,500,000. Variable costing is used internally, and the net income is adjusted to an absorption costing net income at year-end. Data collected over the last three years show the following: Determine the adjustment each year to convert the variable costing income to absorption costing net income. Compute the absorption costing net income for each year.
The following data relates to a company's operating budget for its next operating year: Sales price per unit (E) 12 Sales volume (units) 15,000 Costs: Materials (E) 52,500 Labour (E) 33,800 Energy (E) 101.000 Depreciation (E) 105,000 The budget has been prepared using the following assumptions: Materials costs are variable. Labour costs are semi-variable with a fixed element of £15,000. Depreciation is a fixed cost. An allowance for an energy price increase of 12% has already been included in the energy costs. The company now wishes to revise the data to incorporate the following updated assumptions: Selling prices will be reduced by 11% The sales volume will increase by 11% The rise in the energy prices should be revised to 3% What will be the company's new selling price per unit for the year?
Apparelle Co. developed the following equation to predict certain components of its budget for the coming period: Costs = $50,000 + ($5 x direct labor hours) The $5 would approximate:a. total costb. direct labor rate per hourc. fixed cost per direct labor hourd. variable costs per direct labor hour
K Base Machinery showed the following operating budget for the next year. Complete parts (a) through (d) below Each scenario is independent Sales $2,400,000 Fixed cost Total variable cost Total cost Net income $1,200,000 760,000 1,960,000 $440,000 (a) Calculate the contribution margin and contribution rate. The contribution margin is $ (Round to the nearest dollar as needed.) ma
2) Conner Hardware, Inc's static budget for the year is shown below: Sales (25,000 units) Cost of Goods Sold: Direct Material Direct Labor Overhead (includes $4 per unit Variable cost) Gross Profit Selling Expenses Sales Commissions (Variable) Rent (Fixed) Insurance (Fixed) General and administrative expenses Salaries (fixed) Rent (Fixed) Depreciation (Fixed) Sales Variable Cost: Direct Materials Direct Labor Variable OH Sales Commission Total Variable Cost Contribution Margin Fixed Cost: Fixed OH Rent Expense-Selling Insurance Expense Salaries Expense Rent Expense-General Prepare a flexible budget for Connor Hardware Inc. that shows a detailed budget for its static budget and its actual sales volume of 40,000 units. Use the contribution margin approach. Depreciation Expense Total Fixed Cost Income from Operations $150,000 300,000 175,000 25,000 units 50,000 90,000 35,000 100,000 40,000 60,000 $1,200,000 625,000 575,000 375,000 $ 200,000 40,000 units
Assume that a company provided the following cost formulas for three of its expenses (where q refers to the number of hours worked): Rent (fixed) $ 3,000 Supplies (variable) $ 4.00q Utilities (mixed) $150 + $0.75q The company’s planned level of activity was 2,000 hours and its actual level of activity was 1,900 hours. How much utilities expense would be included in the flexible budget? $1,500 $1,675 $1,575 $1,650
Assume that a company provided the following cost formulas for three of its expenses (where q refers to the number of hours worked): Rent (fixed) Supplies (variable) Utilities (mixed) $3,000 $4.00q $225 + $0.75q The company's planned level of activity was 2,000 hours and its actual level of activity was 1,900 hours. How much utilities expense would be included in the planning budget? Multiple Choice O $1,725 $1,750 $1,650 $1,500
The following details relates to the operations of a company for budgeted output of 10000units; selling price- GHC100, total variable cost- GH¢200000, and total fixed cost- GHC400000. At what quantity and value will the company breakeven? A. 5000units and GHC50000 B. 5000units and GHC5300 OC. 4500units and GHC45000 D. 4000unit and GHC40000
Muhanga Corporation sells three products: R, S, and T. Budgeted information for the upcoming accounting period follows. Product Sales Volume (Units) Selling Price Variable Cost R 17,600 $ 19 $ 13 S 13,600 15 6 T 54,800 16 10 What is the company's weighted-average unit contribution margin?
Based on a predicted level of production and sales of 30,000 units, a company anticipates total contribution margin of $105,000, fixed costs of $40,000, and income of $65,000. Based on this information, the budgeted income for 28,000 units would be: Select one: a. $58,000. b. $ 105,000. c. $52,000. d. $135,333. e. $72,500.