Skelton Corporation had planned to produce 50,000 units of product during the first quarter of the current year. The company prepared the following budget on May 1: Budgeted (50,000 units) Variable costs: Direct materials used Direct labor Variable overhead $ 36.000 45,000 22,500 Fixed costs: Manufacturing overhead Total manufacturing costs 58.500 $162,000 During the first quarter, Carson produced 60,000 units and incurred total manufacturing costs of $184,000. The cost-volume relationship used to prepare Skelton's flexible budget for various production levels includes: O A. Fixed cost of $1.17 per unit . O B. Variable costs of $2.07 per unit. O C. Manufacturing overhead costs of $1.43 per unit. O D. Total cost of $3.05 per unit.
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
![Skelton Corporation had planned to produce 50,000 units of product during the first quarter of the current year. The company prepared the following budget
on May 1:
Budgeted
(50,000
units)
Variable costs:
Direct materials used
$ 36,000
Direct labor
45,000
Variable overhead
22,500
Fixed costs:
Manufacturing overhead
Total manufacturing costs
58,500
$162,000
During the first quarter, Carson produced 60,000 units and incurred total manufacturing costs of $184,000.
The cost-volume relationship used to prepare Skelton's flexible budget for various production levels includes:
A. Fixed cost of $1.17 per unit .
B. Variable costs of $2.07 per unit.
C. Manufacturing overhead costs of $1.43 per unit.
O D. Total cost of $3.05 per unit.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fccccb327-b0cf-4356-af58-0c4da41972fb%2F3b7280b9-8c38-4d0a-a98c-a2ab23e16cfb%2F1nsr8jn_processed.png&w=3840&q=75)
![](/static/compass_v2/shared-icons/check-mark.png)
Trending now
This is a popular solution!
Step by step
Solved in 2 steps with 2 images
![Blurred answer](/static/compass_v2/solution-images/blurred-answer.jpg)
![Financial And Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781337902663/9781337902663_smallCoverImage.jpg)
![Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781337912020/9781337912020_smallCoverImage.jpg)
![Financial And Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781337902663/9781337902663_smallCoverImage.jpg)
![Managerial Accounting](https://www.bartleby.com/isbn_cover_images/9781337912020/9781337912020_smallCoverImage.jpg)
![Excel Applications for Accounting Principles](https://www.bartleby.com/isbn_cover_images/9781111581565/9781111581565_smallCoverImage.gif)
![Principles of Cost Accounting](https://www.bartleby.com/isbn_cover_images/9781305087408/9781305087408_smallCoverImage.gif)
![Cornerstones of Cost Management (Cornerstones Ser…](https://www.bartleby.com/isbn_cover_images/9781305970663/9781305970663_smallCoverImage.gif)