Rodger's Cabinet Manufacturers uses flexible budgets that are based on the following manufacturing data for the month of July: Direct materials $8 per unit
Direct labor $5 per unit
Electric power (variable) $0.30 per unit
Electric power (fixed) $4,000 per month
Supervisor salaries $25,000 per month
Property taxes on factory $4,000 per month
Straight-line depreciation $2,900 per month
Prepare a flexible budget for Rodger's based on production of 10,000, 15,000, and 20,000 units.
Rodger's Cabinet Manufacturers Flexible Manufacturing Budget For the Month Ended July 31

Rodger's Cabinet Manufacturers

Rodger's Cabinet Manufacturers

Flexible Budget for the Month Ended July 31

                                                10,000 units    15,000 units    20,000 units

Variable Costs:

Direct materials $8 per unit     $80,000           $120,000        $160,000

Direct labor $5 per unit             50,000               75,000           100,000

Electric power (variable) $0.30   3,000                  4,500              6,000

Total variable costs                $133,000           $199,500       $266,000

Fixed costs:

Electric power (fixed)                   4,000                 4,000              4,000

Supervisor salaries                   25,000               25,000           25,000

Property taxes on factory           4,000                 4,000              4,000

Straight-line depreciation          2,900                 2,900              2,900

Total fixed costs                    $35,900             $35,900         $35,900

Total costs                           $169,400           $235,400        $301,900

Explanation:

a) Data and Calculations:

Direct materials $8 per unit

Direct labor $5 per unit

Electric power (variable) $0.30 per unit

Electric power (fixed) $4,000 per month

Supervisor salaries $25,000 per month

Property taxes on factory $4,000 per month

Straight-line depreciation $2,900 per month

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