Mouton Corporation Manufactures and Sells a Single Product

question 75

Multiple Choice

Mouton Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During July, the company budgeted for 7,300 units, but its actual level of activity was 7,350 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for July:

Data used in budgeting:
Actual results for July:
-The manufacturing overhead in the flexible budget for July would be closest to:

• A)$52,640
• B)$51,597
• C)$52,306
• D)$52,730

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Definitions:

Accounts Receivable

Accounts receivable represents money owed to a company by its customers for goods or services delivered but not yet paid for, classified as a current asset on the balance sheet.

Transfer Prices

Prices used for transactions between divisions of the same company, often used for budgeting and taxation purposes.

Actual Costs

The real costs incurred by a business, including all expenses related to production, operation, and maintenance.

Standard Costs

Predetermined costs for materials, labor, and overhead used in budgeting and assessing performance by comparing them to actual costs.