Based on past experience, Moss Company has developed the following budget formula for estimating its shipping expenses: Shipping costs = $21,000 + ($0.40 × pounds shipped). The company's shipments average 13 pounds per shipment. The planned activity and actual activity regarding orders and shipments for the current month are given in the following schedule: Plan Actual Sales orders 900 880 Shipments 900 920 Units shipped 9,000 10,000 Sales $ 130,000 $ 154,000 Total pounds shipped 10,600 13,300 The actual shipping costs for the month amounted to $26,000. The appropriate monthly flexible budget allowance for shipping costs for the purpose of performance evaluation would be:

Based on past experience, Moss Company has developed the following budget formula for estimating its shipping expenses: Shipping costs = $21,000 + ($0.40 × pounds shipped). The company's shipments average 13 pounds per shipment. The planned activity and actual activity regarding orders and shipments for the current month are given in the following schedule: Plan Actual Sales orders 900 880 Shipments 900 920 Units shipped 9,000 10,000 Sales $ 130,000 $ 154,000 Total pounds shipped 10,600 13,300 The actual shipping costs for the month amounted to $26,000. The appropriate monthly flexible budget allowance for shipping costs for the purpose of performance evaluation would be:

Practical Management Science

6th Edition

ISBN:9781337406659

Author:WINSTON, Wayne L.

Publisher:WINSTON, Wayne L.

Chapter5: Network Models

Section: Chapter Questions

Problem 80P

See similar textbooks

	Plan	Actual
Sales orders	900	880
Shipments	900	920
Units shipped	9,000	10,000
Sales	$ 130,000	$ 154,000
Total pounds shipped	10,600	13,300

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