Briely describe the budgeting process that might be employed by a company that uses JIT c Prepa that ti Coffs Harbour Pineapple Corp. produces pineapple sweets. company currently uses a static budget process. The company’s controller prepared the following budget for April’s production: 13 Flexible budget LO8 quest of me there You and Estimated production Direct labour per box Direct labour required for estimated 24000 boxes 4 minutes 1600 hours d For production Average direct labour rate per hour Estimated direct labour cost inc hou fixe $12.50 $20000 15 S Actual production during April was 26400 boxes and actual direct labour cost was $22850 Required Prepare a flexible budget for Coffs Harbour Pineapple Corp that shows the projected direct labour cost and any difference between the budget and actual labour cost. Curio prod pillo sell f artis for t com Prohlomm
Expert Answer
The projected DL cost for flexible budget = 26400 boxes *( 4 / 60 ) hours * $ 12.50 per DLH = $ 22000
FLexible budget :-
Actual cost (a) | Spending var. ( a – b) | Flexible budget (b) | Activity variance ( b – c ) | Static budget ( c) | |
DL | 22850 | 850 ( unfav.) | 22000 | 2000 ( unfav.) | 2000 |