Cash budgets

Exercise:  Flexible budget for Assembly Department  OBJ. 2

Steelcase Inc. is one of the largest manufacturers of office furniture in the United States. In Grand Rapids, Michigan, it assembles filing cabinets in an Assembly Department. Assume the following information for the Assembly Department: 

Direct Labour per filing cabinet   12 minutes

Supervisor Salaries   $150,000

Depreciation   $24500 per month

Direct labour rate  $22 per hour

Prepare a flexible budget for 18,000, 20,000, and 22,000 filing cabinets for the month of August 2016 in the Assembly Department, similar to Exhibit 5.

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