Appliance Possible Inc AP is a manufacturer of toaster ovens

Appliance Possible Inc. (AP) is a manufacturer of toaster ovens. To improve control over operations, the president of AP wants to begin using a flexible budgeting system, rather than use only the current master budget. The following data are available for AP\'s expected costs at production levels of 80,000, 90,000, and 100,000 units. a costs Manufacturing Administrative Selling $6 per unit $3 per unit $1 per unit Fixed costs Manufacturing Administrative $130,000 $70,000 ? (a) Prepare a flexible budget for each of the possible production levels: 80,000, 90,000, and 100,000 units. (List variable costs before fixed costs.) APPLIANCE POSSIBLE INC. Flexible Production Cost Budget Activity Level Productlon Levels 80000 90000 100000 a Costs Manufacturin Administrative Sellin Total Variable Costs Total Costs Manufacturin Administrative Total Fixed Costs Total Costs LINK TO TEXT

Solution

Flexible cost budget :

Activity level
Production levels	80000	90000	100000
Variable cost
Manufacturing	480000	540000	600000
Administrative	240000	270000	300000
Selling	80000	90000	100000
Total variable cost	800000	900000	1000000
Fixed cost
Manufacturing	130000	130000	130000
Administrative	70000	70000	70000
Total fixed cost	200000	200000	200000
Total fixed	1000000	1100000	1200000