Prepare a flexible overhead budget, Cost Accounting

Assignment Help:

Under a contract with the provincial government, ChemLabs Inc. analyzes the chemical and bacterial composition of well water in various municipalities in the interior of British Columbia. The contract price is $26.00 per test performed. The normal volume is 10,000 tests per month. Each test requires two testing kits, which have a standard price of $3.60 each. Direct labour to perform the test is 10 minutes at $22.80 per hour. At normal volume, the overhead costs are as follows:
Variable overhead costs Indirect labour $16,000 Utilities 2,000 Labour-related costs 13,000 Laboratory maintenance 8,000 $39,000 Fixed overhead costs Depreciation 27,830 Supervisor 29,620 Base utilities 8,180 Insurance 1,700 67,330 Total overhead $106,330
Overhead is allocated based on direct labour hours. During May 2012, 8,520 tests were performed. The records show the following actual costs and production data:
Activity Actual Cost Number of test kits purchased 19,050 $68,580 Number of test kits used 18,280 Direct labour 1,660 hours 37,210 Total overhead costs Variable 45,080 Fixed 68,150
Test kits are kept in inventory at standard cost. At the end of May, no tests were in process.
Prepare a flexible overhead budget based on 80% of the normal volume.


Related Discussions:- Prepare a flexible overhead budget

Overhead analysis, allocate the overheads to the three departments and do t...

allocate the overheads to the three departments and do the secondary allocation of service departments

Limitations of standard costing, L I M I T A T I O NS OF STANDARD ...

L I M I T A T I O NS OF STANDARD COSTING 1.     It may be very difficult to fix standards for all operations. 2.     Incorrect standards may result in wastage of mo

How many pizzas must vince''s sell to break even, Vince's Pizza delivers pi...

Vince's Pizza delivers pizzas to dormitories and apartments near a major state university. The company's annual fixed costs are $48,000. The sales price averages $9, and it costs t

The cost per complete unit, In a given period production and cost data were...

In a given period production and cost data were as follows:     Total Costs   Materials   Rs. 5,115                      Labour          3,952                     Overheads

Role of cost accounting in organization, Role of Cost Accounting in Organiz...

Role of Cost Accounting in Organization Like part of their jobs, such cost accountants interpret results, and then report them to management and give analysis such assist deci

Combined cash - bank account- cash book, The following is a summary of a ca...

The following is a summary of a cash book for the year ended 31 April 2012 Payments                                              $              Receipts

Estimating, how do you calculate estimating cost for the last of the year b...

how do you calculate estimating cost for the last of the year based on activity during the first half of the year

Marginal costing, sums with solution of marginal costing

sums with solution of marginal costing

Segment reporting, Juniper Ltd is a listed diversified company.  In prepari...

Juniper Ltd is a listed diversified company.  In preparing its financial statements in accordance with AASB 8, the chief operating officer has identified three operating segments:

Purpose of cost accounting, what is the purpose of cost accounting and its ...

what is the purpose of cost accounting and its nat ure?

Write Your Message!

Captcha
Free Assignment Quote

Assured A++ Grade

Get guaranteed satisfaction & time on delivery in every assignment order you paid with us! We ensure premium quality solution document along with free turntin report!

All rights reserved! Copyrights ©2019-2020 ExpertsMind IT Educational Pvt Ltd