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Budget performance report for a cost center Valotic Tech Inc. sells electronics over the Internet. The Consumer Products Division is organized as a cost center. The budget for the (Consumer Products Division for the month ended January 31 is as follows (in thousands): Customer service salaries $ 546.840 Insurance and property taxes 114,660 Distribution salaries 872340 Marketing salaries 1,028370 Engineer salaries 836.850 Warehouse wages 586,110 Equipment depreciation 183,792 Total $4,168,962 During January, the costs incurred in the (Consumer Products Division were as follows: Customer service salaries $ 602,350 Insurance and property taxes 110,240 Distribution salaries 861,200 Marketing salaries 1,085,230 Engineer salaries 820,008 Warehouse wages 562.632 Equipment depreciation 183,610 Total $4,225,270 Instructions 1. Prepare a budget performance report for the director of the Consumer Products Division for the month of January. 2. For which costs might the director be expected to request supplemental reports?

BuyFind

Accounting

27th Edition
WARREN + 5 others
Publisher: Cengage Learning,
ISBN: 9781337272094
BuyFind

Accounting

27th Edition
WARREN + 5 others
Publisher: Cengage Learning,
ISBN: 9781337272094

Solutions

Chapter
Section
Chapter 24, Problem 24.1APR
Textbook Problem

Budget performance report for a cost center

 Valotic Tech Inc. sells electronics over the Internet. The Consumer Products Division is organized as a cost center. The budget for the (Consumer Products Division for the month ended January 31 is as follows (in thousands):

Customer service salaries $ 546.840
Insurance and property taxes 114,660
Distribution salaries 872340
Marketing salaries 1,028370
Engineer salaries 836.850
Warehouse wages 586,110
Equipment depreciation 183,792
Total $4,168,962

 During January, the costs incurred in the (Consumer Products Division were as follows:

Customer service salaries $ 602,350
Insurance and property taxes 110,240
Distribution salaries 861,200
Marketing salaries 1,085,230
Engineer salaries 820,008
Warehouse wages 562.632
Equipment depreciation 183,610
Total $4,225,270

 Instructions

  1. 1. Prepare a budget performance report for the director of the Consumer Products Division for the month of January.
  2. 2. For which costs might the director be expected to request supplemental reports?

Expert Solution

(1)

To determine

Budget performance report: This is a report which compares, enumerates, and reports the difference between the actual costs and the estimated or planned costs. If the actual costs are more than the estimated costs, the difference is reported as over budget. If the actual costs are less than the estimated costs, the difference is reported as under budget.

To prepare: Budget performance report for the director of CP Division, for the month of January

Explanation of Solution

Prepare budget performance report for the director of CP Division, for the month of January.

Incorporation VT
Budget Performance Report-Director CP Division
For the Month Ended January 31
  Actual ($) Budget ($) Over Budget ($) Under Budget ($)
Customer service salaries $602,350 $546,840 $55,510  
Insurance and property taxes 112,240 114,660   $(4,420)
Distribution salaries 861,200 872,340   (11,140) ...
Expert Solution

(2)

To determine

To indicate: The costs which the director requires supplemental reports

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Chapter 24 Solutions

Accounting
Show all chapter solutions
Ch. 24 - Budgetary performance for cost center Caroline...Ch. 24 - Budgetary performance for cost center Conley...Ch. 24 - Service department charges The centralized...Ch. 24 - Service department charges The centralized...Ch. 24 - Income from operations for profit center Using the...Ch. 24 - Income from operations for profit center Using the...Ch. 24 - Profit margin, investment turnover, and ROI Cash...Ch. 24 - Profit margin, investment turnover and ROI Briggs...Ch. 24 - Residual income The Consumer Division of Galena...Ch. 24 - Residual income The Commercial Division of Herring...Ch. 24 - Transfer pricing The materials used by the North...Ch. 24 - Transfer pricing The materials used by the...Ch. 24 - Budget performance reports for cost centers...Ch. 24 - Divisional income statements The following data...Ch. 24 - Service department charges and activity bases For...Ch. 24 - Activity bases for service department charges For...Ch. 24 - Service department charges In divisional income...Ch. 24 - Service department charges and activity bases...Ch. 24 - Divisional income statements with service...Ch. 24 - Corrections to service department charges for a...Ch. 24 - Profit center responsibility reporting Glades...Ch. 24 - Return on investment The income from operations...Ch. 24 - Residual income Based on the data in Exercise...Ch. 24 - Determining missing items in return computation...Ch. 24 - Profit margin, investment turnover, and return on...Ch. 24 - Return on investment The Walt Disney Company has...Ch. 24 - Determining missing items in return and residual...Ch. 24 - Determining missing items from computations Data...Ch. 24 - Return on investment, residual income for a...Ch. 24 - Balanced scorecard for a service company American...Ch. 24 - Building a balanced scorecard Hit-n-Kun Inc. owns...Ch. 24 - Decision on transfer pricing Materials used by the...Ch. 24 - Decision on transfer pricing Based on T_Kong...Ch. 24 - Budget performance report for a cost center...Ch. 24 - Profit center responsibility reporting for a...Ch. 24 - Divisional income statements and return on...Ch. 24 - Effect of proposals on divisional performance A...Ch. 24 - Divisional performance analysis and evaluation The...Ch. 24 - Transfer pricing Garcon Inc. manufactures...Ch. 24 - Budget performance report for a cost center The...Ch. 24 - Profit center responsibility reporting for a...Ch. 24 - Divisional income statements and return on...Ch. 24 - Effect of proposals on divisional performance A...Ch. 24 - Divisional performance analysis and evaluation The...Ch. 24 - Transfer pricing Exoplex Industries Inc. is a...Ch. 24 - Ethics in Action Sembotix Company has several...Ch. 24 - Communication The Norsk Division of Gridiron...Ch. 24 - Service department charges The Customer Service...Ch. 24 - Evaluating divisional performance The three...Ch. 24 - Evaluating division performance Last Resort...

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