Figure 8-8 Rammazzotti, Inc., Is Looking for Feedback on Company Performance. the Performance

Figure 8-8
Rammazzotti, Inc., is looking for feedback on company performance. The company compares the budget for the year with the actual costs. Data have been collected below:
Rammazzotti Inc., had the following budgeted data:
Unit sales for 2016 26,000
Unit production for 2016 26,000
Budgeted fixed overhead for 2016:
Supervision $ 800
Depreciation 2,000
Rent 100
Budgeted variable costs per unit:
Direct materials $0.15
Direct labor 0.20
Supplies 0.02
Indirect labor 0.05
Power 0.02
The following actually occurred:
Actual unit sales for 2016 24,000
Actual unit production for 2016 28,000
Actual fixed overhead for 2016:
Supervision $ 850
Depreciation 2,000
Rent 100
Actual variable costs:
Direct materials $3,500
Direct labor 4,900
Supplies 530
Indirect labor 1,250
Power 470
-Refer to Figure 8-8. The flexible budget for direct materials cost in 2016 is

A) $3,500.
B) $3,600.
C) $3,900.
D) $4,200.

Correct Answer:

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