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Telemark

Price: $3.99


1. Telemark Production's manufacturing costs for July when production was 1,000 units are
below:

Direct materials  $10 per unit
Factory depreciation  $8,000
Variable overhead  5,000
Direct labor  2,000
Factory supervisory salaries  5,800
Other fixed factory costs  1,500

Instructions
How much is the flexible budget manufacturing cost amount for a month when 1,100 units are
produced?

2. Labor data for making one pound of finished product in Curling Co. are as follows: (1) Price—
hourly wage rate $10 payroll taxes $0.80 and fringe benefits $1.20
(2) Quantity - actual production time 1.1 hours, rest periods and clean up 0.25 hours
and setup and downtime 0.15 hours.

Instructions
Compute the following.
(a) Standard direct labor rate per hour.
(b) Standard direct labor hours per pound.
(c) Standard cost per pound

3. Wind Productions uses flexible budgets. Items from the budget for March in which 2,000
units were produced and sold appear below:

Direct materials  $18,000
Indirect materials -variable  2,000
Supervisor salaries  15,000
Depreciation on factory equipment  4,000
Direct labor  10,000
Property taxes on factory  1,000

Instructions
a) If Wind prepares a flexible budget at 3,000 units, compute its variable cost per unit.
b) If Wind prepares a flexible budget at 3,000 units, compute its total variable cost.

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