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Question

In the Bramble Corp., indirect labor is budgeted for $101250 and factory supervision is budgeted for $36000 at normal capacity of
150000 direct labor hours. If 220000 direct labor hours are worked, flexible budget total for these costs is:
a $184500.
b $175500.
c $137250.
d $201300.

Answer 1

To calculate the flexible budget total for indirect labor and factory supervision costs, we need to use the formula:

Flexible Budget = (Budgeted cost at normal capacity / Normal capacity) * Actual capacity

For indirect labor:
Budgeted cost at normal capacity = $101250
Normal capacity = 150000 direct labor hours
Actual capacity = 220000 direct labor hours

Flexible Budget for indirect labor = ($101250 / 150000) * 220000 = $147000

For factory supervision:
Budgeted cost at normal capacity = $36000
Normal capacity = 150000 direct labor hours
Actual capacity = 220000 direct labor hours

Flexible Budget for factory supervision = ($36000 / 150000) * 220000 = $52800

Flexible Budget Total = Flexible Budget for indirect labor + Flexible Budget for factory supervision
Flexible Budget Total = $147000 + $52800 = $199800

Therefore, the correct answer is not given in the options.

Answer 2

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Answer 3

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