“56. RedRock Company uses flexible budgeting for cost control. RedRock produced 10,800 units of product during October, incurring indirect material costs of $13,000. Its master budget for the year reflected indirect material costs of $180,000 at a production volume of 144,000 units. A flexible budget for October production would reflect indirect material costs of: a. $13,000. b. $13,500. c. $13,975. d. $11,700. e. $15,000.”,”2Indirect materials per unit from the budget = Indirect Material Costs / Production Volume = 180,000 = $1.25 /unit 144,000Flexible budget:Units of product x Indirect materials per unit = Indirect material costs10,800 x $1.25 = $13
500″