Luxury Food Processing Company prepared the following budgeted amounts for the month of March 2023 based on
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Question:
Variable Cost of Production per Unit:
Direct materials 3 lbs. @ $2.75 per lb.
Direct Labor 2.5 hours @$18.50 per hour
Variable Overhead 2.5 hours @ $28.00 per hour
Fixed Overhead:
Material related $85,000
Depreciation on factory equipment $30,000
At the end of March, 5,500 units were produced with the following actual costs:
Direct Materials $150,500
Direct Labor $287,000
Variable Overhead $365,000
Fixed Overhead:
Materials related $84,000
Depreciation on factory equipment $30,000
Required:
A). Make a Static Budget for March 2023.
B) Prepare a Performance Report using the Flexible Budget at the Actual level of production and Actual Results.
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