Find Missing Data for Profit
Required
Find the values of the missing items (a) through (q). Assume that the actual sales volume equals actual production volume. (There are no inventory level changes.)
Find the missing data for profit variance analysis.
Explanation of Solution
Profit variance analysis:
The analysis that studies the difference between the actual operating profit and the standard operating profit is called the profit variance analysis.
Prepare profit variance analysis:
Actual Revenue & Costs | Manufacturing variance | Marketing and administrative variance | Sales price variance | Flexible budget | Sales Activity Variance | Master budget | |
Units Produced | 2,250 | 2,250 | 150U(1) | 2,400 | |||
Sales revenue | $117,000 | $4,500U(2) | $121,500 | $8,100(13) | $129,600(3) | ||
Less: Variable costs | |||||||
Manufacturing | $30,600(7) | $3,600F | $34,200(5) | $2,280F | $36,480(6) | ||
Marketing &administrative costs | $12,000(8) | $1,500F(11) | $13,500(10) | $900F | $14,400 | ||
Contribution margin | $74,400 | $3,600F | $1,500F | $4,500U | $73,800 | $4,920U | $78,720 |
Table: (1)
Working Note 1:
Sales activity variance units and sales revenue:
Working Note 2:
Working Note 3:
Working Note 4:
Working Note 5:
Working Note 6:
Working Note 7:
Working Note 8:
Working Note 9:
Working Note 10:
Working Note 11:
Working Note 12:
Working Note 13:
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Chapter 16 Solutions
Fundamentals Of Cost Accounting (6th Edition)
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