Flexible Budget for Various Levels of Production Budgeted amounts for the year: Materials Labor VOH FOH...

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Flexible Budget for Various Levels of Production Budgeted amounts for the year: Materials Labor VOH FOH 2 leather strips @ $7.00 1.5 hr. @ $18.00 1.5 hr. @ $1.20 $6,800 Required: 1. Prepare a flexible budget for 3,500, 4,000, and 4,500 units. Flexible Budget Variable Cost per Unit 3,500 units 4,000 units 4,500 units Direct materials $ $ $ Direct labor Variable overhead Fixed overhead Total 2. Conceptual Connection: Calculate the unit cost at 3,500, 4,000, and 4,500 units. (Note: Round unit costs to the nearest cent.) Unit cost at 3,500 units $ Unit cost at 4,000 units $ Unit cost at 4,500 units $ What happens to unit cost as the number of units produced increases? The cost per unit as the number of units produced increases because fixed cost is spread over a greater number of units. Flexible Budget for Various Levels of Production Budgeted amounts for the year: Materials Labor VOH FOH 2 leather strips @ $7.00 1.5 hr. @ $18.00 1.5 hr. @ $1.20 $6,800 Required: 1. Prepare a flexible budget for 3,500, 4,000, and 4,500 units. Flexible Budget Variable Cost per Unit 3,500 units 4,000 units 4,500 units Direct materials $ $ $ Direct labor Variable overhead Fixed overhead Total 2. Conceptual Connection: Calculate the unit cost at 3,500, 4,000, and 4,500 units. (Note: Round unit costs to the nearest cent.) Unit cost at 3,500 units $ Unit cost at 4,000 units $ Unit cost at 4,500 units $ What happens to unit cost as the number of units produced increases? The cost per unit as the number of units produced increases because fixed cost is spread over a greater number of units.

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