(iv) Semivariablecostsareexpectedtorelatetothedirectlabourhoursinthesamemanneras
forthelastfiveyears:
(v) FixedCost:
Depreciation 18,000
Maintenance 10,000
Insurance 4,000
Rates 15,000
ManagementSalaries 25,000
(vi) Inflationistobeignored.
(c) Calculatethebudgetedcostallowance(ieexpectedexpenditure)for20X6assumingthat57,000
directlabourhoursareworked. 5
The End