Monday, June 13, 2011

1. What is the flexible-budget amount?

ACCOUNTING

Multiple Choice

Jenny’s Corporation manufactured 25,000 grooming kits for horses during March. The fixed-overhead cost-allocation rate is $20.00 per machine-hour. The following fixed overhead data pertain to March.

Actual Static Budget

Production 25,000 units 24,000 units

Machine-hours 6,100 hours 6,000 hours

Fixed overhead costs for March $123,000 $120,000


What is the flexible-budget amount?

a. $120,000

b. $122,000

c. $123,000

d. $125,000

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