Exercise 21-4 (Algo) Preparing flexible budget performance report LO P1Complete the following partial flexible budget performance report, and indicate whether each variance is favorable or unfavorable.The company budgets a selling price of $89 per unit and variable costs of $34 per unit. (Indicate the effect of each variance byselecting favorable, unfavorable, or no variance.)Flexible Budget Performance ReportFor Month Ended June 30SalesFlexible Budget(12,600 units)Variable costsContribution marginFixed costsIncomeActual Results(12,600 units)VariancesFavorable/Unfavorable$28,600 Favorable369,000693,000288,000303,000

The flexible budget is prepared for the actual level of production using the standard rates. The…

Answered: Exercise 21-4 (Algo) Preparing flexible…

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter7: The Master Budget And Flexible Budgeting

Section: Chapter Questions

Problem 7P: Preparing a performance report Use the flexible budget prepared in P7-6 for the 31,000-unit level...

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Preparing a performance report Use the flexible budget prepared in P7-6 for the 29,000-unit level of activity and the actual operating results listed below for the 29,000- unit level. Required: 1. Prepare a performance report. 2. List the major reasons why the actual operating income at 29,000 units differs from the master budget operating income at 30,000 units in Figure 7-12. 3. Given the level at which the company operated, how was its cost control? Item Direct materials: Direct labor:
Refer to the data in Exercise 9.15. Required: 1. Compute overhead variances using a two-variance analysis. 2. Compute overhead variances using a three-variance analysis. 3. Illustrate how the two- and three-variance analyses are related to the four-variance analysis. Oerstman, Inc., uses a standard costing system and develops its overhead rates from the current annual budget. The budget is based on an expected annual output of 120,000 units requiring 480,000 direct labor hours. (Practical capacity is 500,000 hours.) Annual budgeted overhead costs total 787,200, of which 556,800 is fixed overhead. A total of 119,400 units using 478,000 direct labor hours were produced during the year. Actual variable overhead costs for the year were 230,600, and actual fixed overhead costs were 556,250. Required: 1. Compute the fixed overhead spending and volume variances. How would you interpret the spending variance? Discuss the possible interpretations of the volume variance. Which is most appropriate for this example? 2. Compute the variable overhead spending and efficiency variances. How is the variable overhead spending variance like the price variances of direct labor and direct materials? How is it different? How is the variable overhead efficiency variance related to the direct labor efficiency variance?
Sales Variances; Flexible-Budget Variance; Review of Chapter 14 Robinson Company hastwo products, A and B. Robinson’s budget for August follows:Master BudgetProduct A Product BSales $240,000 $300,000Variable cost 140,000 180,000Contribution margin $100,000 $120,000Fixed cost 80,000 40,000Operating income $ 20,000 $ 80,000Selling price $ 120 $ 50On September l, these operating results for August were reported:Operating ResultsProduct A Product BSales $180,400 $341,120Variable cost 106,600 216,480Contribution margin $ 73,800 $124,640Fixed cost 80,000 40,000Operating income $ (6,200) $ 84,640Units sold 1,640 6,560Required1. For each product, determine the following variances measured in dollars of contribution margin:a. Flexible-budget variance.b. Sales volume variance.c. Sales quantity variance.d. Sales mix variance.2. Explain the amount of the flexible-budget variance using the amounts of the selling price and variablecost variances.
Requirement 2. Prepare a flexible-budget-based variance analysis of the September performance. Begin with the actual results, then complete the flexible budget columns and the static budget columns. Label each variance as favorable or unfavorable. (For variances with a $0 balance, make sure to enter "0" in the appropriate field. If the variance is zero, do not select a label. Enter operating losses with a minus sign or parentheses.) Actual Results Units sold Revenues Variable costs Contribution margin Fixed costs Operating income (loss)
Flexible Budgets and the Breakdown of the Total Operating Income Variance Assumethat in October 2019 the Schmidt Machinery Company (Exhibit 14.1) manufactured and sold950 units for $835 each. During this month, the company incurred $475,000 total variable costsand $180,000 total fixed costs. The master (static) budget data for the month are as given inExhibit 14.1.Required (Round all your answers to the nearest whole number): 1. Prepare a flexible budget for the production and sale of 950 units.2. Compute for October 2019: a. The sales volume variance, in terms of operating income. Indicate whether this variance was favorable (F) or unfavorable (U). b. The sales volume variance, in terms of contribution margin. Indicate whether this variance wasfavorable (F) or unfavorable (U). 3. Compute for October 2019:a. The total flexible-budget (FB) variance. Indicate whether this variance was favorable (F) or unfavorable (U). b. The total variable cost flexible-budget variance. Indicate whether…
Prepare a Flexible Budget Performance Report Required: Using Exhibit 9–8 as your guide, prepare a flexible budget performance report that shows the company’s revenue and spending variance and activity variances for august. Exhibit 9–8 Performance Report Combining Activity Variances with Revenue and Spending Variances
Q.Prepare an analysis of variances for the third quarter of 2017 along the lines of Exhibit 7-2; identify the sales volume and flexible budget variances for operating income.
1. Complete the flexible budget performance report that shows both revenue and spending variances and activity variances for the pizzeria for November. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.)
Squillace Corporation uses customers served as its measure of activity. During October, the company budgeted for 38,000 customers, but actually served 35,000 customers. The company has provided the following data concerning the formulas used in its budgeting and its actual results for October. Required:Prepare the company's flexible budget performance report for October (calculate both activity variances and revenue and spending variances). Label each variance as favorable (F) or unfavorable (U). Use the templates given below.
Cicchetti Corporation uses customers served as its measure of activity. The following report compares the planning budget to the actual operating results for the month of December: Cicchetti CorporationComparison of Actual Results to Planning BudgetFor the Month Ended December 31 Actual Results Planning Budget Variances Customers served 42,000 38,000 Revenue ($5.0q) $ 211,200 $ 190,000 $ 21,200 F Expenses: Wages and salaries ($37,900 + $1.8q) 117,400 106,300 11,100 U Supplies ($0.6q) 24,400 22,800 1,600 U Insurance ($14,900) 15,550 14,900 650 U Miscellaneous expense ($7,900 + $0.5q) 31,050 26,900 4,150 U Total expense 188,400 170,900 17,500 U Net operating income $ 22,800 $ 19,100 $ 3,700 F Required:Prepare the company's flexible budget performance report for December. Select each variance as favorable (F), unfavorable (U) or…
Exercise 21-6 (Algo) Preparing flexible budget performance report LO P1 Lewis Company reports the following fixed budget and actual results for May. Prepare a flexible budget performance report showing variances between budgeted and actual results. (Indicate the effect of the variance by selecting favorable, unfavorable, or no variance.) \table[[,Fixed Budget,Actual Results],[Sales (units produced and sold),1,240,1,440],[Sales (in dollars),$500 per unit,$735,000
Show transcribed image text 15.What activity variances would Adger report with respect to each of its expenses? (Indicate the effect of each variance by selecting F for favorable, U for unfavorable, and None for no effect (i.e., zero variance). Input all amounts as positive values.) [The following information applies to the questions displayed below.] Adger Corporation is a service company that measures its output based on the number of customers served. The company provided the following fixed and variable cost estimates that it uses for budgeting purposes and the actual results for May as shown below: When preparing its planning budget the company estimated that it would serve 30 customers per month; however, during May the company actually served 35 customers.

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