BREWER ND LL INTRO MGRL ACTG CON+ AC
19th Edition
ISBN: 9781260711851
Author: BREWER
Publisher: McGraw-Hill Publishing Co.
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Textbook Question
Chapter 9, Problem 1E
Prepare a Flexible Budget
Puget Sound Divers is a company that provides diving services such as underwater ship repairs to clients in the Puget Sound area The company’s planning budget for May appears below:
During May, the company’s actual activity was 105 diving-hours.
Required:
Using Exhibit 9−5 as your guide, prepare a flexible budget for May.
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Prepare a Flexible Budget Performance Report
Vulcan Flyovers offers scenic overflights of Mount St. Helens, the volcano in Washington State that explosively erupted in 1982. Data concerning the company’s operations in July appear below:
The company measures its activity in terms of flights. Customers can buy individual tickets for overflights or hire an entire plane for an overflight at a discount.
Required:
1. Using Exhibit 9–8 as your guide, prepare a flexible budget performance report for July that includes revenue and spending variances and activity variances.
2. Which of the variances should be of concern to management? Explain.
Exhibit 9–8 Performance Report Combining Activity Variances with Revenue and Spending Variances
Prepare flexible budget screen shots of entire question and options provided
Exercise 9-1 (Algo) Prepare a Flexible Budget [LO9-1]
Puget Sound Divers provides diving services, such as underwater ship repairs, to its clients. The company's planning budget for May
appears below:
Puget Sound Divers
Planning Budget
For the Month Ended May 31
Budgeted diving-hours (g)
Revenue ($460.00g)
Expenses:
Wages and salaries ($11,200 + $128.00q)
Supplies ($4.00q)
Equipment rental ($2,400 + $22.00q)
Insurance ($3,900)
Miscellaneous ($500 + $1.44q)
Total expenses
Net operating income
250
$ 115,000
43,200
1,000
7,900
3,900
860
56,860
$ 58,140
During May, the company's actual activity was 240 diving-hours.
Chapter 9 Solutions
BREWER ND LL INTRO MGRL ACTG CON+ AC
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