Prepare a schedule of variable and fixed cost

Assignment Help Accounting Basics

Reference no: EM132260771

Question: Bush incorporated, a manufacturing company reports the following actual costs for the year ended December 31, 2018.

Account

Classification

Cost

Direct materials

Direct manufacturing labor

Power

Supervision labor

Materials-handling labor

Maintenance labor

Depreciation

Rent, property taxes, admin

All Variable

20% Variable

50% Variable

40% Variable

All Fixed

$300,000

225,000

37,500

56,250

60,000

75,000

95,000

100,000

The company produced 75,000 units in 2018 and the management is estimating the costs for 2019 using the information from 2018. The following additional information is available for 2019.

a. Direct materials prices in 2019 are expected to increase by 5% compared with 2018.

b. Under the terms of the labor contract, direct manufacturing labor wage rates are expected to increase by 10% in 2019 compared with 2018.

c. Power rates and wage rates for supervision, materials handling, and maintenance are not expected to change.

d. Depreciation costs, rent, property taxes, and administration costs are expected to increase by 10%.

e. The company expects to manufacture and sell 80,000 units in 2019.

Requirements: 1. Prepare a schedule of variable and fixed cost for each of the costs and total manufacturing cost for 2018 and 2019.

2. Calculate the company's per unit cost for 2018 and 2019.

Reference no: EM132260771

Questions Cloud

Why is the blackberry controversy prominent : Why is the BlackBerry controversy prominent in Asia, particularly in the Middle East, and not anywhere else in the world? Analyze the measures that RIM.

What are all of the documents we will need to have prepared : We are preparing for an audit of the system for HIPAA compliance. What are all of the documents we will need to have prepared for the upcoming audit?

Selecting security software system for business : In this assignment, you will be evaluating and selecting a security software system for a business.

What is customer relations : What is customer relations, this is the main method to ensure you will retain your customer base. How would you begin to build a strong

Prepare a schedule of variable and fixed cost : Prepare a schedule of variable and fixed cost for each of the costs and total manufacturing cost for 2018 and 2019. Calculate the company's per unit cost.

Business ethics highlight the main focus : Business Ethics Highlight the main focus areas that were the most valuable to you and describe why.

What is agile methodology : What is AGILE methodology and explain how the scope is derived in this methodology?

Gained into organizational change : For each insight, discuss how and why your thinking and/or behavior have changed, and how you will apply the learning in the future.

Strategic management paper : Find scientific article about corporate strategy (diversification, merger & acquisition, controlling, portfolio, parenting, holding company).

User Account

All Pages