The managements of Farginny Enterprise had just realized about the advantages of using flexible budget in...

 

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The managements of Farginny Enterprise had just realized about the advantages of using flexible budget in planning and controlling the company performance. Thus the management had decided to prepare a flexible budget by using flexible budgeting approach. The followings are information collected for two levels of operation: Levels of production Direct material Direct labor Manufacturing overhead Electricity Royalty Commission Supervision Depreciation Salaries Rates 70% RM 65,625 52,500 13,125 2,625 7,625 10,375 10,000 20,000 12,000 5,000 80% 300,000 units RM 75,000 60,000 15,000 3,000 8,000 11,500 10,000 20,000 12,000 5,000 Additional information; i) ii) Budgeted selling price = RM 3.00/unit Actual selling price = RM 2.70/unit For the year ended 2010, the actual cost of production is as follow: Levels of production Direct material Direct labor Manufacturing overhead Electricity Royalty Commission Supervision Depreciation Salaries Rates 85% RM 78,000 62,500 15,850 3,200 8,100 12,000 10,000 20,000 13,500 6,000 You are required to prepare; (a) A flexible budget statement for 60% and 85% levels of activity. (b) A performance report for the year ended 2010. The managements of Farginny Enterprise had just realized about the advantages of using flexible budget in planning and controlling the company performance. Thus the management had decided to prepare a flexible budget by using flexible budgeting approach. The followings are information collected for two levels of operation: Levels of production Direct material Direct labor Manufacturing overhead Electricity Royalty Commission Supervision Depreciation Salaries Rates 70% RM 65,625 52,500 13,125 2,625 7,625 10,375 10,000 20,000 12,000 5,000 80% 300,000 units RM 75,000 60,000 15,000 3,000 8,000 11,500 10,000 20,000 12,000 5,000 Additional information; i) ii) Budgeted selling price = RM 3.00/unit Actual selling price = RM 2.70/unit For the year ended 2010, the actual cost of production is as follow: Levels of production Direct material Direct labor Manufacturing overhead Electricity Royalty Commission Supervision Depreciation Salaries Rates 85% RM 78,000 62,500 15,850 3,200 8,100 12,000 10,000 20,000 13,500 6,000 You are required to prepare; (a) A flexible budget statement for 60% and 85% levels of activity. (b) A performance report for the year ended 2010.

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a Flexible Budget Statement For 60 level of activity yaml Copy code Levels of production 60 Budgeted ... View the full answer