QS 21-4 Flexible budget performance report P1 The fixed budget for 20,000 units of production shows sales of $400,000; variable costs of $80,000; and fixed costs of $150,000. The company's actual sales were 26,000 units at $480,000. Actual variable costs were $112,000 and actual fixed costs were $145,000. Prepare a flexible budget performance report. Indicate whether each variance is favorable or unfavorable. Page 847

QS 21-4 Flexible budget performance report P1 The fixed budget for 20,000 units of production shows sales of $400,000; variable costs of $80,000; and fixed costs of $150,000. The company's actual sales were 26,000 units at $480,000. Actual variable costs were $112,000 and actual fixed costs were $145,000. Prepare a flexible budget performance report. Indicate whether each variance is favorable or unfavorable. Page 847

Financial & Managerial Accounting

14th Edition

ISBN:9781337119207

Author:Carl Warren, James M. Reeve, Jonathan Duchac

Publisher:Carl Warren, James M. Reeve, Jonathan Duchac

Chapter21: Budgeting

Section: Chapter Questions

Problem 21.1APR: Forecast sates volume and sales budget For 20Y8, Raphael Frame Company prepared the sales budget...

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Forecast sates volume and sales budget For 20Y8, Raphael Frame Company prepared the sales budget that follows. At the end of December 20Y8, the following unit sales data were reported for the year: Unit Sales 8" 10" Frame 12" 16" Frame East 8,755 3,686 Central 6,510 3,090 West 12,348 5,616 For the year ending December 31, 20Y9, unit sales are expected to Follow the patterns established during the year ending December 31, 20Y8. The unit selling price for the 8" 10" the frame is expected to Increase to 17 and the unit selling price for the 12" 16" frame is expected to increase to 32, effective January 1, 20Y9. Instructions 1. Compute the increase or decrease of actual unit sales for the year ended December 31,. 20Y8, Over budget. Place your answers in a columnar table with the following format: 2. Assuming that the increase or decrease in actual sales to budget indicated in part (1) is to continue in 20Y9, compute the unit sales volume to lie used for preparing the sales budget for the year ending December 31, 20Y9. Place your answers in a columnar table similar to that in part (1) but with the following column heads. Round budgeted units to the nearest. 20Y8 Percentage 20Y9 Actual Increase Budgeted Units (Decrease) Units (rounded) 3. Prepare a sales budget for the year ending December 51. 20Y9.
Forecast sales volume and sales budget For 20Y6, Raphael Frame Company prepared the sales budget that follows. At the end of December 20Y6, the following unit sales data were reported for the year: Unit Sales 8" 10" Frame 12" 16" Frame East 8,755 3,686 Central 6,510 3,090 West 12,348 5,616 Raphael Frame Company Sales Budget For the Year Ending December 31, 20Y6 Unit Sales Unit Selling Total Product and Area Volume Price Sales 8"10" Frame: East 8,500 16 136,000 Central 6,200 16 99,200 West 12,600 16 201,600 Total 27,300 436,800 12" x 16" Frame: East 3,800 30 5114,000 Central 3,000 30 90,000 West 5,400 30 162,000 Total 12,200 366,000 Total revenue from sales 802,800 For the year ending December 31, 20Y7, unit sales are expected to follow the patterns established during the year ending December 31, 20Y6. The unit selling price for the 8" 10"frame is expected to increase to 17, and the unit selling price for the 12" 16" frame is expected to increase to 32, effective January 1, 20Y7. Instructions 1. Compute the increase or decrease of actual unit sales for the year ended December 31, 20Y6, over budget. Place your answers in a columnar table with the following format: Unit Sales, Year Ended 20Y6 Increase (Decrease) Actual Over Budget Budget Actual Sales Amount Percent 8" 10" Frame: East Central West 12"16" Frame: East Central West 2. Assuming that the increase or decrease in actual sales to budget indicated in part (1) is to continue in 20Y7, compute the unit sales volume to be used for preparing the sales budget for the year ending December 31, 20Y7. Place your answers in a columnar table similar to that in part (1) but with the following column heads. Round budgeted units to the nearest unit. 20Y6 Percentage 20Y7 Actual Increase Budgeted Units (Decrease! Units (rounded) 3. Prepare a sales budget for the year ending December 31, 20Y7.
Budgeted income statement and supporting budgets The, budget director of Feathered Friends Inc., with the assistance of the controller, treasurer, production manager, and sales manager, has gathered the following data for use in developing the budgeted income statement for December 2016: a. Estimated .sales for December: Bird house 3,200 units at 50 per unit Bird feeder 3,000 units at 70 per unit b. Estimated inventories at December 1: Direct materials: Finished products: Wood 200 ft Bird house....... 320 units at 27 per unit Plastic 240 lbs. Bird feeder....... 270 units at 40 per unit c. Desired inventories at December 31: Direct materials: Finished products: Wood 220 ft Bird house....... 290 units at 27 per unit Plastic 200 lbs. Bird feeder....... 250 units at 41 per unit d. Direct materials used in production: In manufacture of Bird House: In manufacture of Bird Feeder: Wood 0.80 ft. per unit of product Wood........... 1.20 ft per unit of product Plastic 050 lb. per unit of product Plastic........... 0.75 lb. per unit of product e. Anticipated cost of purchases and beginning and ending inventory of direct materials: Wood 7.00 per ft. Plastic................. 1.00 per lb. f. Direct labor requirements: Bird House: Fabrication Department 0.20 hr. at 16 per hr. Assembly Department 0.30 hr. at 12 per hr. Bird Feeder: Fabrication Department 0.40 hr. at 16 per hr. Assembly Department 0.35 hr. at 12 per hr. g. Estimated factory overhead costs for December. Indirect factory wages 75,000 Power and light 6,000 Depreciation of plant and equipment 23,000 Insurance and property tax 5,000 h. Estimated operating expenses for December: Sales salaries expense 70,000 Advertising expense 18,000 Office salaries expense 21,000 Depreciation expenseoffice equipment 600 Telephone expenseselling 550 Telephone expenseadministrative 250 Travel expenseselling 4,000 Office supplies expense 200 Miscellaneous administrative expense 400 i. Estimated other income and expense for December: Interest revenue 200 Interest expense 122 j. Estimated lax rate: 30% Instructions 1. Prepare a sales budget for December. 2. Prepare a production budget for December. 3. Prepare a direct materials purchases budget for December. 4. Prepare a direct labor cost budget for December. 5. Prepare a factory overhead cost budget for December. 6. Prepare a cost of goods sold budget for December. Work in process at the beginning of December is estimated to be 29,000 and work in process at the end of December is estimated to be 35,400. 7. Prepare a selling and administrative expenses budget for December. 8. Prepare a budgeted income statement for December.
Sales, production, direct materials purchases, and direct labor cost budgets The budget director of Gourmet Grill Company requests estimates of sales, production, and other operating data from the various administrative units every month. Selected information concerning sales and production for July is summarized as follows: A. Estimated sales for July by sales territory: Maine: Backyard Chef............................. 310 units at 700 per unit Master Chef............................... 150 units at 1,200 per unit Vermont: Backyard Chef............................. 240 units at 750 per unit Master Chef............................... 110 units at 1,300 per unit New Hampshire: Backyard Chef............................. 360 units at 750 per unit Master Chef............................... 180 units at 1,400 per unit B. Estimated inventories at July 1: Direct materials: Finished products: Grates..................... 290 units Backyard Chef........ 30 units Stainless steel.............. 1,500 lbs. Master Chef........... 42 units Burner subassemblies...... 170 units Shelves.................... 340 units C. Desired inventories at July 31: Direct materials: Finished products: Grates......................... 340 units Backyard Chef........ 40 units Stainless steel.................. 1,800 lbs. Master Chef........... 20 units Burner subassemblies.......... 155 units Shelves........................ 315 units D. Desired materials used in production In manufacture of Backyard Chef: Grates........................................ 3 units per unit of product Stainless steel................................. 24 lbs. per unit of product Burner subassemblies......................... 2 units per unit of product Shelves....................................... 4 units per unit of product In manufacture of Master Chef: Grates........................................ 6 units per unit of product Stainless steel................................. 42 lbs. per unit of product Burner subassemblies......................... 4 units per unit of product Shelves....................................... 5 units per unit of product E. Anticipated purchase price for direct materials: Grates................. 15 per unit Stainless steel.......... 6 per lb. Burner subassemblies...... 110 per unit Shelves.................... 10 per unit F. Desired labor requirements: Backyard Chef: Stamping Department...................... 0.50 hr. at 17 per hr. Forming Department....................... 0.60 hr. at 15 per hr. Assembly Department...................... 1.00 hr. at 14 per hr. Master Chef: Stamping Department...................... 0.60 hr. at 17 per hr. Forming Department....................... 0.80 hr. at 15 pr hr. Assembly Department...................... 1.50 hrs. at 14 per hr. Instructions 1. Prepare a sales budget for July. 2. Prepare a production budget for July. 3. Prepare a direct materials purchases budget for July. 4. Prepare a direct labor cost budget for July.
Budgeted income statement and supporting budgets The budget director of Birds of a Feather Inc., with the assistance of the controller, treasurer, production manager, and sales manager, has gathered the following data for use in developing the budgeted income statement for January: a. Estimated sales for January: Birdhouse 6.000 units at 55 per unit Bird feeder 4,500 units at 75 per unit b. Estimated inventories at January 1: Direct materials: Finished products: Wood 220 ft. Birdhouse 300 units at 23 per unit Plastic 250 lb. Bird feeder 240 units at 34 per unit c. Desired inventories at January 31: Direct materials: Finished products: Wood 180 ft. Birdhouse 340 units at 23 per unit Plastic 210 lb. Bird feeder 200 units at 34 per unit d. Direct materials used in production: In manufacture of Birdhouse: In manufacture of Bird Feeder: Wood ... 0.80 ft. per unit of product Wood 1.20 ft. per unitof product Plastic . . 0.50 lb. per unit of product Plastic 0.75 lb. per unit of product e. Anticipated cost of purchases and beginning and ending inventory of direct materials: Wood 8.00 per ft. Plastic 1.20 per lb. f. f. Direct labor requirements: Birdhouse: Fabrication Department 0.20 hr. at15 per hr. Assembly Department 0.30 hr. at 12 per hr. Bird Feeder: Fabrication Department 0.40 hr. at15 per hr. Assembly Department 0.35 hr. at 12 per hr. g. Estimated factory overhead costs for January: Indirect factory wages 80,000 Power and light 8,000 Depreciation of plant and equipment 25,000 Insurance and property tax 2,000 h. Estimated operating expenses for January: Sales salaries expense 90,000 Advertising expense 20,000 Office salaries expense 18,000 Depredation expenseoffice equipment 800 Telephone expenseselling 500 Telephone expenseadministrative 200 Travel expenseselling 5,000 Office supplies expense 250 Miscellaneous administrative expense 450 i. Estimated other income and expense for January: Interest revenue 300 Interest expense 224 j. Estimated tax rate: 30% Instructions 1. Prepare a sales budget for January. 2. Prepare a production budget for January. 3. Prepare a direct materials purchases budget for January. 4. Prepare a direct labor cost budget for January. 5. Prepare a factory overhead cost budget for January. 6. Prepare a cost of goods sold budget for January. Work in process at the beginning of January is estimated to be 29,000, and work in process at the end of January is estimated to be 35,400. 7. Prepare a selling and administrative expenses budget for January. 8. Prepare a budgeted income statement for January.
Forecast sales volume and sales budget For 2016, Raphael Frame Company prepared the .sales budget that follows. At the end of December 2016, the following unit sales data were reported for the year. Unit Sales 8" 10" Frame 12" 16" Frame East 8,755 3,686 Central 6,510 3,090 West 12,348 5,616 For the year ending December 31, 2017, unit sales are expected to follow die patterns established during the year ending December 31, 2016. The unit selling price for the 8" 10" frame is expected to increase to 17 and die unit selling price for die 12" 16" frame is expected to increase to 32, effective January 1, 2017. Instructions 1. Compute the increase or decrease of actual unit sales for the year ended December 31, 2016, over budget. Place your answers in a columnar table with the following format: Unit Sales, Year Ended 2016 Increase (Decrease) Actual Over Budget Budget Actual Sales Amount Percent 8" 10" Frame: East Central West 12" 16" Frame: East Central West 2. Assuming that the increase or decrease in actual sales to budget indicated in part (1) is to continue in 2017, compute the unit sales volume to be used for preparing the sales budget for the year ending December 31, 2017. Place your answers in a columnar table similar to that in part (1) but with the following column heads. Round budgeted units to the nearest unit. 2016 Actual Units Percentage Increase (Decrease) 2017 Budgeted Units (rounded) 3. Prepare a sales budget for the year ending December 31, 2017.
Budgeted income statement and supporting budgets The budget director of Gold Medal Athletic Co., with the assistance of the controller, treasurer, production manager, and sales manager, has gathered the following data for use in developing the budgeted income statement for March 2016: a. Estimated sales for March: Batting helmet 1,200 units at 40 per unit Football helmet 6,500 units at 160 per unit b. Estimated inventories at March 1: Direct materials: Finished products: Plastic 90 lbs. Batting helmet........ 40 units at 25 per unit Foam lining 80 lbs. Football helmet....... 240 units at 77 per unit c. Desired inventories at March 31: Direct materials: Finished products: Plastic50 lbs. Batting helmet......... 50 units at 25 per unit Foam lining65 lbs. Football helmet........ 220 units at 78 per unit d. Direct materials used in production: In manufacture of batting helmet: Plastic 1.20 lbs. per unit of product Foam lining 0.50 lb. per unit of product In manufacture of football helmet: Plastic 3.50 lbs. per unit of product Foam lining 1.50 lbs. per unit of product e. Anticipated cost of purchases and beginning and ending inventor) of direct materials: Plastic 6.00 per lb. Foam lining 4.00 per lb. f. Direct labor requirements: Batting helmet: Molding Department 0.20 hr. at 20 per hr. Assembly Department 0.50 hr. at 14 per hr. Football helmet: Molding Department 0.50 hr. at 20 per hr. Assembly Department 1.80 hrs. at 14 per hr. g. Estimated factory overhead costs for March: Indirect factory wages 86,000 Power and light 4,000 Depreciation of plant and equipment 12,000 Insurance and property tax 2,300 h. Estimated operating expenses for March: Sales salaries expense 184,300 Advertising expense 87,200 Office salaries expense 32,400 Depreciation expenseoffice equipment 3,800 Telephone expenseselling 5,800 Telephone expenseadministrative 1,200 Travel expense-selling 9,000 Office supplies expense 1,100 Miscellaneous administrative expense 1,000 i. Estimated other income and expense for March: Interest revenue 940 Interest expense 872 j. Estimated tax rate: 30% Instructions 1. Prepare a sales budget for March. 2. Prepare a production budget for March. 3. Prepare a direct materials purchases budget for March. 4. Prepare a direct labor cost budget for March. 5. Prepare a factory overhead cost budget for March. 6. Prepare a cost of goods sold budget for March. Work in process at the beginning of March is estimated to be 15,300, and work in process at the end of March is desired to be 14,800. 7. Prepare a selling and administrative expenses budget for March. 8. Prepare a budgeted income statement for March.
Budgeted income statement and supporting budgets The budget director of Gold Medal Athletic Co., with the assistance of the controller, treasurer, production manager, and sales manager, has gathered the following data for use in developing the budgeted income .statement for March: a. Estimated sales for March: Batting helmet 1,200 units at 40 per unit Football helmet 6,500 units at 160 per unit b. Estimated inventories at March 1: Direct materials: Finished products: Plastic 90 lb. Batting helmet 40 units at 25 per unit Foam lining 80 lb. Football helmet 240 units at 77 per unit c. Desired inventories at March 31: Direct materials: Finished products: Plastic 50 lb. Batting helmet 50 units at 25 per unit Foam lining 65 lb. Football helmet 220 its at 78 per unit d. Direct materials used in production: In manufacture of batting helmet: Plastic 1.20 lb. per unit of product Foam lining 0.50 lb. per unit of product In manufacture of football helmet: Plastic 3.50 lb. per unit of product Foam lining 1.50lb. per unit of product e. Anticipated cost of purchases and beginning and ending inventory of direct materials: Plastic 6.00 per lb. Foam lining 4.00 per lb. f. Direct labor requirements: Batting helmet: Molding Department 0.20 hr. at 20 per hr. Assembly Department 0.50 hr. at 14 per hr. Football helmet: Molding Department 0.50 hr. at 20 per hr. Assembly Department l.80 hrs.at 14perhr. g. Estimated factory overhead costs for March: Indirect factory wages 86,000 Power and light 4,000 Depreciation of plant and equipment 12,000 Insurance and property tax 2300 h. Estimated operating for March: Sales salaries expense 184,300 Advertising expense 87,200 Office salaries expense 32,400 Depreciation expenseoffice equipment 3,800 Telephone expenseselling 5,800 Telephone expenseadministrative 1,200 Travel expenseselling 9,000 Office supplies expense 1,100 Miscellaneous administrative expense 1,000 i. Estimated other income and expense for March: Interest Revenue 940 Interest Expense 872 j. Estimated tax rate: 30% Instructions 1.Prepare a sales budget for March. 2.Prepare a production budget for March. 3. Prepare a direct materials purchases budget for March. 4. Prepare a direct labor cost budget for March. 5. Prepare a factory overhead cost budget for March. 6. Prepare a cost of goods sold budget for March. Work in process at the beginning of March is estimated to be 15,300, and work in process at the end of March is desired to be 14,800. 7.Prepare a selling and administrative expenses budget for March. 8.Prepare a budgeted income statement for March. 9.Prepare a factory overhead cost budget for March. 10.Prepare a cost of goods .sold budget for March. Work in process at the beginning of March is estimated to the 115,300, and work in process at the end of March is desired to be 14,800. 11.Prepare a selling and administrative expenses budget for March. 12.Prepare a budgeted income statement for March.