Bob and Sons' Static Budget for 10,000 Units of Production

question 121

Multiple Choice

Bob and Sons' static budget for 10,000 units of production includes $50,000 for direct materials, $44,000 for direct labor, variable utilities of $5,000, and supervisor salaries of $25,000. A flexible budget for 12,000 units of production would show:

• A) the same cost structure in total
• B) direct materials of $60,000, direct labor of $52,800, utilities of $6,000, and supervisor salaries of $30,000
• C) total variable costs of $148,000
• D) direct materials of $60,000, direct labor of $52,800, utilities of $6,000, and supervisor salaries of $25,000

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Definitions:

Goal-Setting Retreat

A dedicated time away from the usual environment aimed at defining objectives and planning strategies to achieve them.

Organizational Culture

The shared values, beliefs, and practices that influence the behavior of individuals within an organization.

Cultural Training

The process of educating individuals about the cultural norms, values, and practices of a different society to enhance their interaction and communication within that context.

Ideological Control

The corporate development of a system of values, beliefs, and meanings with which employees are expected to identify strongly.