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Cornerstones of Managerial Accounting 4th Edition by Maryanne Mowen, Don Hansen, Dan Heitger
Edition 4ISBN: 978-0324380767Cornerstones of Managerial Accounting 4th Edition by Maryanne Mowen, Don Hansen, Dan Heitger
Edition 4ISBN: 978-0324380767 Exercise 3
Static Budget for an Activity
Madison Company decided to look more closely at the inspection activity in its factory. The following information for a year was collected:
Demand for inspections: 170,000
Resources needed:
a. 6 inspectors, capable of inspecting 30,000 units per year; salary is $32,000 each
b. Supplies (small tools, oil, rags) expected to cost $0.70 per inspection
c. Workbenches, computers, etc.; depreciation $18,300 per year
d. Factory space for the inspection station, utilities; $12,600 per year
Required:
Prepare a static budget for the inspection activity for the year.
Madison Company decided to look more closely at the inspection activity in its factory. The following information for a year was collected:
Demand for inspections: 170,000
Resources needed:
a. 6 inspectors, capable of inspecting 30,000 units per year; salary is $32,000 each
b. Supplies (small tools, oil, rags) expected to cost $0.70 per inspection
c. Workbenches, computers, etc.; depreciation $18,300 per year
d. Factory space for the inspection station, utilities; $12,600 per year
Required:
Prepare a static budget for the inspection activity for the year.
Explanation
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Static budget for an...
Cornerstones of Managerial Accounting 4th Edition by Maryanne Mowen, Don Hansen, Dan Heitger
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