Answered Essay: Miller and Sons' static budget for 10,000 units of production includes $43,500 for direct materials, $45,000 for direct labor, variable utilities of

ageNowv2] Onlir Q Managerial Chapter 23 Flas | + × com/ilm/takeAssignment/takeAssignmentMain.do?inprogress-true Caloutator Miller and Sons static budget for 10,000 units of production indudes $43 500 for direct materials, $45,000 for direct labor, va able utlies of S6Ao·ard sag v or sal s of Sisco. 12,500 units of production would show Round your final answer to the nearest dollar. Do not round interim caloulations Ototal variable costs of $110,400 Othe same cost structure in total direct materials of $54,375, direct labor of $56,250, utilties of $8,000, and supervisor salaries of $15,500 Odrect materials of s54,37s, direct labor of $56,250, utilities of s8,000, and supervsor salaries of $18,600

Miller and Sons’ static budget for 10,000 units of production includes $43,500 for direct materials, $45,000 for direct labor, variable utilities of $6,400,middotand supervisor salaries of $15,500. A flexible budget for 12,500 units of production would show Round your final answer to the nearest dollar. Do not round interim calculations. total variable costs of $110,400 the same cost structure in total direct materials of $54,375, direct labor of $56,250, utilities of $8,000, and supervisor salaries of $15,500 direct materials of $54,375, direct labor of $56,250, utilities of $8,000, and supervisor salaries of $18,600

Expert Answer

Miller and Sons static Budget
For 10,000 units For 12,500 units
Direct Material $               43,500 $              54,375
Direct labor $               45,000 $              56,250
Variable utilities $                 6,400 $                 8,000
Supervisor salaries $               15,500 $              15,500

Explanation:

For 12,500 units

Direct material = ($ 43,500/10,000) x 12500 = $ 54,375

Direct labor = ($ 45,500/10,000) x 12500 = $ 56,250

Variable utilities = ($6,400/10,000) x 12500 = $ 8,000

Supervisor salaries will be same for both production level.

Hence option 3rd “direct material of $ 54,375, direct labor of $ 56,250, utilities of $ 8,000, and Supervisor salaries of 15,500” is correct answer.

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