Page 1 : Budgeting and Budgetary Control 251, , Find the unit t, cost of the product at production levels of 4,000 units and 6,000 units, (I.C.W.A. Inter), , : [Ans. Unit cost at 4,000 units % 13.37; at 6,000 units % 12.00, 3. Production costs of Oriental Enterprises Limited are as follows ¢ \echaeds “i, , Level of Activity, , , , , , , , oat 60% 70% 80%, Output (in units) 7,200 1,400 1,600, , Costs (in © ) : : =, Direct materials 24,000 28,000 32,000, Direct labour 7,200 8,400 9,600, Factory overheads 12,800 13,600 14,400, Works cost 44,000 50,000 56,000, , , , See a ee Produc:ion to 90% level of activity is under the consideration of management., € proposal is not expected to involve any increase in fixed factory overheads. Prepare a statement, , showing the prime cost, total marginal ivi, Goer ginal cost and total factory cost at 90% level of activity., , e [Ams. Factory cost at 90% 2 62,000), 4. For production of 10,000 Electrical Irons, the following are budgeted expenses:, , Per unit @, Direct materials 60, Direct labour 30, Variable overhead 25, Fixed overhead (% 1,50,000) 15, Variable expenses (direct) 5, Selling expenses (10% fixed) 15, , Administration expenses (% 50,000 rigid of all levels of production) 5, Distribution expenses (20% fixed) 5, , Total cost of sales per unit 160, Prepare a budget for production of 6,000, 7,000 and 8,000 Irons, showing distinctly marginal cost, and total cost. (C.A. Inter), , [Ans. Total cost at 6,000 units, % 10,50,000, per unit ~ 175;, Total cost at 7,000 units 11,87,500, per unit ¥ 169.64;, Total cost at 8,000 units, % 13,25,000, per unit = 165.63], , 5. The monthly budgets for factory overhead of a company for two levels of activity were as follows :, , 60% 100%, , Budgeted production (units) 600 1,000, z =, , Wages 1,200 2,000, Consumable stores 900 1,500, Maintenance 1,100 1,500, Power and fuel 1,600 2,000, Depreciation 4,000 4,000, Insurance 1,000 1,000, , Total a 9,800 12,000