Outlet Company's planning budget for 20Y5 was based on the following assumptions: Outlet wouldproduce and sell 8,000 units, its fixed administrative expenses would be $518,000, and the variablecomponent of administrative expenses is 30% of total administrative expenses. During 20Y5, Outletactually produced and sold 8,500 units and its actual total administrative expenses were $734,000.What is the administrative expense spending variance for 20Y5?$25,875 favorable$13,875 favorable$6,000 favorableO $52,250 favorableO None of the above

Variance analysis refers to the assessment of the deviation of actual activity from the forecasted…

Outlet Company's planning budget for 20Y5 was based on the following assumptions: Outlet would produce and sell 8,000 units, its fixed administrative expenses would be $518,000, and the variable component of administrative expenses is 30% of total administrative expenses. During 20Y5, Outle actually produced and sold 8,500 units and its actual total administrative expenses were $734,000. What is the administrative expense spending variance for 20Y5? O $25,875 favorable

Outlet Company's planning budget for 20Y5 was based on the following assumptions: Outlet would produce and sell 8,000 units, its fixed administrative expenses would be $518,000, and the variable component of administrative expenses is 30% of total administrative expenses. During 20Y5, Outle actually produced and sold 8,500 units and its actual total administrative expenses were $734,000. What is the administrative expense spending variance for 20Y5? O $25,875 favorable

Managerial Accounting

15th Edition

ISBN:9781337912020

Author:Carl Warren, Ph.d. Cma William B. Tayler

Publisher:Carl Warren, Ph.d. Cma William B. Tayler

Chapter9: Evaluating Variances From Standard Costs

Section: Chapter Questions

Problem 3CMA

See similar textbooks

Similar questions

Cold X, Inc. uses this information when preparing their flexible budget: direct materials of $2 per unit, direct labor of $3 per unit, and manufacturing overhead of $1 per unit. Fixed costs are $35,000. What would be the budgeted amounts for 20,000 and 25,000 units?
Nashler Company has the following budgeted variable costs per unit produced: Budgeted fixed overhead costs per month include supervision of 98,000, depreciation of 76,000, and other overhead of 245,000. Required: 1. Prepare a flexible budget for all costs of production for the following levels of production: 160,000 units, 170,000 units, and 175,000 units. 2. What is the per-unit total product cost for each of the production levels from Requirement 1? (Round each unit cost to the nearest cent.) 3. What if Nashler Companys cost of maintenance rose to 0.22 per unit? How would that affect the unit product costs calculated in Requirement 2?
The production cost for UV protective sunglasses is $5.50 per unit and fixed costs are $19,400 per month. How much is the favorable or unfavorable variance if 14,000 units were produced for a total of $97,000?
Lowell Manufacturing Inc. has a normal selling price of 20 per unit and has been selling 125,000 units per month. In November, Lowell Manufacturing decided to lower its price to 19 per unit expecting it can increase the units sold by 16%. a. Compute the normal revenue with a 20 selling price. b. Compute the planned revenue with a 19 selling price. c. Compute the actual revenue for November, assuming 135,000 units were sold in November at 19 per unit. d. Compute the revenue price variance, assuming 135,000 units were sold in November at 19 per unit. e. Compute the revenue volume variance, assuming 135,000 units were sold in November at 19 per unit. f. Analyze and interpret the lowering of the price to 19.
Budgeted unit sales for the entire countertop oven industry were 2,500,000 (of all model types), and actual unit sales for the industry were 2,550,000. Recall from Cornerstone Exercise 18.6 that Iliff, Inc., provided the following information: Required: 1. Calculate the market share variance (take percentages out to four significant digits). 2. Calculate the market size variance. 3. What if Iliff actually sold a total of 41,000 units (in total of the two models)? How would that affect the market share variance? The market size variance?
Judges Gavel uses this information when preparing their flexible budget: direct materials of $3 per unit, direct labor of $2.50 per unit, and manufacturing overhead of $1.25 per unit. Fixed costs are $49,000. What would be the budgeted amounts for 33,000 and 35,000 units?
Using the following per-unit and total amounts, prepare a flexible budget at the 14,000-, 15,000-, and 16,000-unit levels of production and sales for Natural Products Inc.:
Using the following budgeted information for production of 5,000 and 12,000 units, prepare a flexible budget for 9,000 units.
Starburst Inc. has the following items and amounts as part of its master budget at the 10,000-unit level of sales and production: Determine the total dollar amounts for the above items that would appear in a flexible budget at the following volume levels, assuming that both levels are within the relevant range: a. 8,000-unit level of sales and production b. 12,000-unit level of sales and production (Hint: You must first determine the unit selling price and certain unit costs.)
Prepare a flexible budgeted income for 120,000 units using the following information from a static budget for 100,000 units:
Using the provided budgeted information for production of 10,000 and 15,000 units, prepare a flexible budget for 17,000 units.
Before the year began, the following static budget was developed for the estimated sales of 100,000. Sales are sluggish and management needs to revise its budget. Use this information to prepare a flexible budget for 80,000 and 90,000 units of sales.