Exercise 8-7A (Algo) Evaluating a decision to increase sales volume by lowering sales price LO 8-3, 8-4 Finch Educational Services had budgeted its training service charge at $82 per hour. The company planned to provide 37,000 hours of training services during Year 3. By lowering the service charge to $67 per hour, the company was able to increase the actual number of hours to 38,200. Required a. Determine the sales volume variance, and indicate whether it is favorable (F) or unfavorable (U). Note: Select "None" if there is no effect (i.e., zero variance). b. Determine the flexible budget variance, and indicate whether it is favorable (F) or unfavorable (U). Note: Select "None" if there is no effect (i.e., zero variance). c. Did lowering the price of training services increase revenue? a. Volume variance b. Flexible budget variance c. Was the decision profitable ? Sales

Exercise 8-7A (Algo) Evaluating a decision to increase sales volume by lowering sales price LO 8-3, 8-4 Finch Educational Services had budgeted its training service charge at $82 per hour. The company planned to provide 37,000 hours of training services during Year 3. By lowering the service charge to $67 per hour, the company was able to increase the actual number of hours to 38,200. Required a. Determine the sales volume variance, and indicate whether it is favorable (F) or unfavorable (U). Note: Select "None" if there is no effect (i.e., zero variance). b. Determine the flexible budget variance, and indicate whether it is favorable (F) or unfavorable (U). Note: Select "None" if there is no effect (i.e., zero variance). c. Did lowering the price of training services increase revenue? a. Volume variance b. Flexible budget variance c. Was the decision profitable ? Sales

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 5CE: Saginaw Company is a garden products wholesale firm. In December, Saginaw Company expects to sell...

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ndow Help mework.pdf 山 Aa v Question 3 A. An operation projected it would serve 10,000 guests at an average sale per guest of $11 in a specific budget period. In that period, the operation actually served 11,000 guests and achieved revenue of $100,000. What was the operation's variance in revenue for the period? B. A manager originally budgeted $85,500 in sales with a 38% food cost target. The revenue budgeted is revised upward to $100,000. What would be the amount projected for food cost in the new budget? e200.000 for the.
View Policies Current Attempt in Progress James, the production manager, was pleased at the company's income statement results. Actual DL cost was only $52,000, compared to the budgeted $60,200, while actual sales volume came in 200 units below original projections. The company actually used 2,500 DL hours to make the 1,200 units produced and sold. Each unit was budgeted to take 2 DL hours; each DL hour was budgeted at $21.50 per hour. Calculate the company's DL price and DL efficiency variances. (Round intermediate calculations to to 2 decimal places, e.g. 15.25 and final answers to 0 decimal places, e.g. 5,125.) DL price variance $ DL efficiency variance $ Save for Later V V Attempts: 0 of 1 used Submit Answer
Question:1 The LM30 Company produces circuits for TV manufacturers. A new accountant intern at LM30 has accidentally deleted the company's variance analysis calculations for the year ended December 31, 2020. The following table is what remains of the data. Performance Report, Year Ended December 31, 2020 Flexible Sales Budget Flexible Actual Results Variance Budget Variances Volume Static Budget Units Sold 170,000 150,000 Revenues $1,080,000.00 $900,000.00 $745,000.00 $335,000.00 $600,000.00 $300,000.00 Variable Costs Contribution margin Fixed costs $140,000.00 $120,000.00 Operating income $195,000.00 $180,000.00
MC Qu. 7-70 Santa Fe Production sells a single product to Santa Fe Production sells a single product to wholesalers. The company's budget for the upcoming year revealed anticipated unit sales of 36,400, a selling price of $28, variable cost per unit of $10, and total fixed costs of $384,000. If Santa Fe’s unit sales are 300 units less than anticipated, its break-even point will: Multiple Choice increase by $18 per unit sold. decrease by $18 per unit sold. increase by $10 per unit sold. decrease by $10 per unit sold. not change.
QUESTION 5 The following budgeted profit statement has been prepared using absorption costing principles.A company manufactures and sells a single product which has the following cost and sellingprice structure: P/unit P/unit Selling price P120 Direct material 22 Direct labour 36 Variable overhead 14 Fixed overhead 12 P84 Profit per unit P36 The fixed overhead absorption rate is based on the normal capacity of 2,000 units per month.Assume that the same amount is spent each month on fixed overheads.Budgeted sales for next month are 2,200 units.You are required to calculate:a. The breakeven point, in sales units per month. b. The margin of safety for the next month. c. The budgeted profit for the next month. d. The sales required to achieve a profit of P96,000.
Using high low method compute for the Variable cost Rhea Company manufacture laptops, preparing the next year budget the accountant complied these data. Month Machine Hours Electricity Cost Jan 8,000.00 92,040.00 Feb 7,000.00 80,760.00 Mar 6,500.00 75,120.00 Apr 6,000.00 69,480.00 May 6,000.00 69,480.00 Jun 3,500.00 41,280.00 Jul 7,000.00 80,760.00 Aug 8,600.00 98,808.00 Sep 3,700.00 43,536.00 Oct 5,000.00 58,200.00 Nov 9,600.00 110,088.00 Dec 10,000.00 114,600.00
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Refer to Exercise 8.27. At the end of the year, Meliore, Inc., actually produced 310,000 units of the standard model and 115,000 of the deluxe model. The actual overhead costs incurred were: Required: Prepare a performance report for the period. In an attempt to improve budgeting, the controller for Meliore, Inc., has developed a flexible budget for overhead costs. Meliore, Inc., makes two types of products, the standard model and the deluxe model. Meliore expects to produce 300,000 units of the standard model and 120,000 units of the deluxe model during the coming year. The standard model requires 0.05 direct labor hour per unit, and the deluxe model requires 0.08. The controller has developed the following cost formulas for each of the four overhead items: Required: 1. Prepare an overhead budget for the expected activity level for the coming year. 2. Prepare an overhead budget that reflects production that is 10 percent higher than expected (for both products) and a budget for production that is 20 percent lower than expected.
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?
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