10) Piechocki Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During May, the company budgeted for 7200 units, but its actual level of activity was 7150 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for May: Data used in budgeting: Revenue Direct labor Direct materials Manufacturing overhead Selling and administrative expenses Total expenses Actual results for May: Revenue Direct labor Direct materials Manufacturing overhead Selling and administrative expenses Fixed element per month The revenue variance for May would be closest to: B) $1195 F A) $1195 U $ 0 42,000 26,000 $68,000 C) $540 U Variable element per unit $ 34.70 6.70 13.20 2.20 0.70 $ 22.80 $ $ 249,300 $ 48,110 S 95,680 46,000 30,520 S S D) $540 F
10) Piechocki Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During May, the company budgeted for 7200 units, but its actual level of activity was 7150 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for May: Data used in budgeting: Revenue Direct labor Direct materials Manufacturing overhead Selling and administrative expenses Total expenses Actual results for May: Revenue Direct labor Direct materials Manufacturing overhead Selling and administrative expenses Fixed element per month The revenue variance for May would be closest to: B) $1195 F A) $1195 U $ 0 42,000 26,000 $68,000 C) $540 U Variable element per unit $ 34.70 6.70 13.20 2.20 0.70 $ 22.80 $ $ 249,300 $ 48,110 S 95,680 46,000 30,520 S S D) $540 F
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
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Transcribed Image Text:10) Piechocki Corporation manufactures and sells a single product. The company uses units
as the measure of activity in its budgets and performance reports. During May, the
company budgeted for 7200 units, but its actual level of activity was 7150 units. The
company has provided the following data concerning the formulas used in its budgeting
and its actual results for May:
Data used in budgeting:
Revenue
Direct labor
Direct materials
Manufacturing overhead
Selling and administrative expenses
Total expenses
Actual results for May:
Revenue
Direct labor
Direct materials
Manufacturing overhead
Selling and administrative expenses
Fixed element Variable element
per month
The revenue variance for May would be closest to:
B) $1195 F
A) $1195 U
C) $540 U
0
0
42,000
26,000
$68,000
per unit
$ 34.70
S
6.70
13.20
2.20
0.70
$ 22.80
$ 249,300
S 48,110
S 95,680
S 46,000
30,520
S
D) $540 F
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