Delaware Corp.prepared a master budget that included $21,360 for direct materials,$33,600 for direct labor,$18,000 for variable overhead,and $46,440 for fixed overhead.Delaware Corp.planned to sell 4,000 units during the period,but actually sold 4,300 units.How much would direct materials cost be on a flexible budget for the period based on actual sales?
A)$19,870
B)$21,360
C)$22,962
D)$91,848

Question

Quizplus · Accepted Answer

To calculate the flexible budget for direct materials, we need to use the formula: flexible budget = actual sales x budgeted cost per unit. The budgeted cost per unit for direct materials is $21,360/4,000 = $5.34. Therefore, the flexible budget for direct materials based on actual sales of 4,300 units would be $5.34 x 4,300 = $22,962. Therefore, the correct answer is C.