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At 9,000 drect labor hours, the flexible budget for indirect materials is $27,000. If $28,000 of indirect materials costs are incurred at 9,200 direct labor hours, the flexible budget report should show the following difference for indirect materials:___________. 1. $1,000 favorable. 2. $400 unfavorable.3. $400 favorable 4. $1,000 unfavorable.

Respuesta :

Answer:

2. $400 unfavorable

Explanation:

Data provided in the question

Direct labor hours = 9,000

Indirect material cost = $27,000

On Actual basis

Indirect material cost = $28,000

Direct labor hours = 9,200

So, the difference for indirect material is

= Indirect material cost ÷ direct labor hours × direct labor hours - indirect material cost

= $27,000 × 9,200 ÷ 9,000 - $28,000

= $27,600 - $28,000

= $400 unfavorable

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