Pangkor Bhd produces one uniform product. The assembly department encounters wide fluctuation in activity levels from...

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Pangkor Bhd produces one uniform product. The assembly department encounters wide fluctuation in activity levels from month to month. However, the following department overhead budget depicts expectations of currently attainable efficiency for an 'average' or 'normal' level of activity of 20,000 units of production per month: Budget Actual cost incurred in the Normal month of January 2020 month (RM) (RM) Indirect labour (variable) 20,000 19,540 Supplies (variable) 1,000 1,000 Power (variable) 1,000 980 Repairs (variable) 1,000 880 Other variable overhead cost 2,000 1,800 Depreciation (fixed) 10,000 10,000 Other fixed overhead cost 5,000 5,000 40,000 39,200 Required: (1) Prepare a flexible budget statement for 16,000; 20,000 and 24,000 units level of activity, showing the budget formula. Pangkor Bhd produces one uniform product. The assembly department encounters wide fluctuation in activity levels from month to month. However, the following department overhead budget depicts expectations of currently attainable efficiency for an 'average' or 'normal' level of activity of 20,000 units of production per month: Budget Actual cost incurred in the Normal month of January 2020 month (RM) (RM) Indirect labour (variable) 20,000 19,540 Supplies (variable) 1,000 1,000 Power (variable) 1,000 980 Repairs (variable) 1,000 880 Other variable overhead cost 2,000 1,800 Depreciation (fixed) 10,000 10,000 Other fixed overhead cost 5,000 5,000 40,000 39,200 Required: (1) Prepare a flexible budget statement for 16,000; 20,000 and 24,000 units level of activity, showing the budget formula.

Answer rating: 100% (QA)

Statement of Flexible Budget for 160002000024000 Units of Level of Activity Actual Cost Budget Incur... View the full answer