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Unformatted text preview: Webb Company Limited Manufacturing of Jackets Budgeted Cost Selling Price per unit 120 Direct material cost 60 Direct manufacturing labor cost 16 Variable manufacturing overheads 12 Total variable cost 88 Fixed Manufacturing overheads 276000 What is the Budgeted Cost and Profit for 12000 units? (for the month of July) Static Budget No of units 12000 Sales 1440000 Direct material cost 720000 Direct manufacturing labor cost 192000 Variable manufacturing overheads 144000 Total variable cost 1056000 Fixed Manufacturing Overheads 276000 Profit 108000 The actual results for a specific period are as follows: No of units 10000 Sales 1250000 Direct material cost 621600 Direct manufacturing labor cost 198000 Variable manufacturing overheads 130500 Total variable cost 950100 Fixed Manufacturing Overheads 285000 Profit 14900 What are your comments on actual and budgeted profit? Operating Income Variance-93100 Why variance is adverse and very high? Flexible Budget Manufacturing of Jackets Budgeted Cost...
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- Spring '12