Osage, Inc., manufactures and sells lamps. The company produces only when it recelves orders and, therefore, has no Inventories. The following Information is available for the current month: Actual (based on actual orders for Master Budget (based on budgeted orders for 488, eee units) $4,320, 000 45e, 00e units) $4,494, 000 Sales revenue Less Variable costs 1,536, 000 312,000 624, e00 432,000 $2,904,000 $1,416,000 Materials Direct labor Variable overhead 1,536,000 247,000 674, 400 421,e00 $2,878,400 $1,615,600 Variable marketing and adninistrative Total variable costs Contribut ion margin Less Fixed costs Manufacturing overhead Marketing Adninistrative 923, 800 278,000 200,000 $1,401,800 $ 213,800 895, e00 278,000 175,000 $1, 148,000 Total fixed costs Operating profits 68,e00 Required: Prepare a flexible budget for Osage, Inc. (Do not round intermediate calculations.) OSAGE, INC. Flexible Budget Sales revenue Variable costs: Materials Direct labor Variable overhead Variable marketing and administrative Total variable costs Contribution margin Fixed costs: Manufacturing overhead Marketing Administrative
Osage, Inc., manufactures and sells lamps. The company produces only when it recelves orders and, therefore, has no Inventories. The following Information is available for the current month: Actual (based on actual orders for Master Budget (based on budgeted orders for 488, eee units) $4,320, 000 45e, 00e units) $4,494, 000 Sales revenue Less Variable costs 1,536, 000 312,000 624, e00 432,000 $2,904,000 $1,416,000 Materials Direct labor Variable overhead 1,536,000 247,000 674, 400 421,e00 $2,878,400 $1,615,600 Variable marketing and adninistrative Total variable costs Contribut ion margin Less Fixed costs Manufacturing overhead Marketing Adninistrative 923, 800 278,000 200,000 $1,401,800 $ 213,800 895, e00 278,000 175,000 $1, 148,000 Total fixed costs Operating profits 68,e00 Required: Prepare a flexible budget for Osage, Inc. (Do not round intermediate calculations.) OSAGE, INC. Flexible Budget Sales revenue Variable costs: Materials Direct labor Variable overhead Variable marketing and administrative Total variable costs Contribution margin Fixed costs: Manufacturing overhead Marketing Administrative
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter18: Pricing And Profitability Analysis
Section: Chapter Questions
Problem 20E: Eastman, Inc., manufactures and sells three products: R, S, and T. In January, Eastman, Inc.,...
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Concept explainers
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Question
How would I prepare a flexible budget? Please see attached picture for the whole problem and the answer format.
Transcribed Image Text:Osage, Inc., manufactures and sells lamps. The company produces only when it receives orders and, therefore, has no Inventories. The
following Information Is available for the current month:
Actual (based on
actual orders for
458, 800 units)
$4,494, e08
Master Budget (based
on budgeted orders
for 480,000 units)
Sales revenue
$4,328,800
Less
Variable costs
Materials
1,536, 800
1,536, 800
312,e00
624, e00
Direct labor
247,000
674,400
421,e00
$2,878,400
$1,615,600
Variable overhead
Variable marketing and adninistrative
432,e00
$2,904,000
$1,416,e00
Total variable costs
Contribution margin
Less
Fixed costs
Manufacturing overhead
Marketing
Administrative
923, 800
278, e00
895, e00
278,e00
200,000
$1,401,800
$ 213,888
175,000
$1,348,e00
Total fixed costs
Operating profits
68, e00
Required:
Prepare a flexible budget for Osage, Inc. (Do not round intermediate calculations.)
OSAGE, INC.
Flexible Budget
Sales revenue
Variable costs:
Materials
Direct labor
Variable overhead
Variable marketing and administrative
Total variable costs
Contribution margin
Fixed costs:
Manufacturing overhead
Marketing
Administrative
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