Question

Osage. Inc.., manufactures and sells lamps. The company produces only when it receives orders and, therefore, has no inventories. The following information is available for the current month Actual (based on Master Budget (based on budgeted orders for 480,000 units) $4,8e0, eee actual orders for 450,eee units) $4,968,eee Sales revenue Less Variable costs Materials Direct labor 1,440, eee 336, eee 624,eee 480,e0e $2,880,eee $1,920, eee 1,440, eee 276, eee 674,400 468,eee $2,858,400 $2,189,600 Variable overhead Variable marketing and administrative Total variable costs Contribution margin Less Fixed costs Manufacturing overhead Marketing Ad 988, 880 288,eee 284,eee $1,480,800 960, e08 288,ee8 188,eee $1,428,e0e 492,eee inistrative Total fixed costs Operating profits 628,800

Answer 1

Answer: Osage. Inc Flexible Budget. particulars Sales Revenue [$4,800,000/480,000) 450,000] Les-variable costante 458 casila $4500,000 $13,50,000 Material (41,440,000/480000) 450,000] Direct Labor (4336.000/480,000) 450,000] variable overheadL684000/480000) 450,0007 | $585,00 variable Marketing and Administration w $480,000/480,000) 450,000] Total variable cost contribution Margin $4,500,000-$2,700,000] $ 450,000 $2,700,000 Marketing Fixed costs: 1,500,000-$2,700,000] $1,800,000 Manufacturing overhead *960,000 $288,000 Administration $180,000 Total fized costs $1,428,000 operating profit ($ 1800,000 - $1,428,000) $372,000