The Foot Company currently produces sandals in an automated process. Expected produc?tion per month is 20,000 units.The required direct materials cost is $1.50 per unit.Manufacturing fixed overhead costs are $30,000 per month.Manufac?turing overhead is allocated based on units of production._____ is the flexible budget for 15,000 and 20,000 units, respectively.
A)$22,500 and $30,000
B)$52,500 and $60,000
C)$45,000 and $60,000
D)$88,000 and $76,000

Question

Quizplus · Accepted Answer

The flexible budget includes variable costs and fixed costs. For 15,000 units: Direct materials cost = 15,000 units * $1.50 = $22,500. Fixed overhead = $30,000. Total = $52,500. For 20,000 units: Direct materials cost = 20,000 units * $1.50 = $30,000. Fixed overhead = $30,000. Total = $60,000.

The Foot Company Currently Produces Sandals in an Automated Process