These were Lakeview Company's budgeted production costs for the current year at an expected output of 20 000 units: $$\begin{array} { l l }
\text { Direct labour } & \$ 13 \text { per unit } \
\text { Direct materials } & \$ 7 \text { per unit } \
\text { Variable overhead } & \$ 5 \text { per unit } \
\text { Fixed ov erhead } & \$ 30000
\end{array}$$ Assume Lakeview uses a flexible budgeting system and actually produced 22 000 units at a total cost of $560 000.By how much did actual production cost differ from the flexible budget amount and in which direction?

Question

These were Lakeview Company's budgeted production costs for the current year at an expected output of 20 000 units: $$\begin{array} { l l } 
\text { Direct labour } & \$ 13 \text { per unit } \
\text { Direct materials } & \$ 7 \text { per unit } \
\text { Variable overhead } & \$ 5 \text { per unit } \
\text { Fixed ov erhead } & \$ 30000
\end{array}$$ Assume Lakeview uses a flexible budgeting system and actually produced 22 000 units at a total cost of $560 000.By how much did actual production cost differ from the flexible budget amount and in which direction?

Quizplus · Accepted Answer

The Answer of These were Lakeview Company's budgeted production costs for the current year at an expected output of 20 000 units: $$\begin{array} { l l } 
\text { Direct labour } & \$ 13 \text { per unit } \
\text { Direct materials } & \$ 7 \text { per unit } \
\text { Variable overhead } & \$ 5 \text { per unit } \
\text { Fixed ov erhead } & \$ 30000
\end{array}$$ Assume Lakeview uses a flexible budgeting system and actually produced 22 000 units at a total cost of $560 000.By how much did actual production cost differ from the flexible budget amount and in which direction?

These Were Lakeview Company's Budgeted Production Costs for the Current