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Fill in the Blank QuestionFill in the blank question.A company sells a product for $3. Direct materials are $1.80 per unit. The company prepares a flexible budget at two sales volumes. At a sales volume of 50 units, budgeted direct materials will be $. At a sales volume of 60 units, budgeted direct materials will be $.

Question

Fill in the Blank QuestionFill in the blank question.A company sells a product for 3.Directmaterialsare3. Direct materials are 1.80 per unit. The company prepares a flexible budget at two sales volumes. At a sales volume of 50 units, budgeted direct materials will be .Atasalesvolumeof60units,budgeteddirectmaterialswillbe. At a sales volume of 60 units, budgeted direct materials will be .

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Solution

To calculate the budgeted direct materials, you need to multiply the cost per unit by the sales volume.

  1. For a sales volume of 50 units: 1.80(costperunit)50(units)=1.80 (cost per unit) * 50 (units) = 90. So, at a sales volume of 50 units, budgeted direct materials will be $90.

  2. For a sales volume of 60 units: 1.80(costperunit)60(units)=1.80 (cost per unit) * 60 (units) = 108. So, at a sales volume of 60 units, budgeted direct materials will be $108.

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