4. Clarke Inc. operates the Patio Furniture Division as a profit center. Operating data for this division for the year ended December 31, 202o, are as shown below. Difference from Budget Budget Sales $2,500,000 $50,000 F Cost of goods sold Variable 1,300,000 41,000 F Controllable fixed 200,000 3,000 U Selling and administrative Variable 220,000 6,000 U Controllable fixed 50,000 2,000 U Noncontrollable fixed direct oy 70,000 4,000 U costs In addition, Clarke incurs $180,000 of indirect fixed costs that were budgeted at $175,000. Twenty percent (20%) of these costs are allocated to the Patio Furniture Division. Instructions a. Prepare a responsibility report for the Patio Furniture Division for the year. b. Comment on the manager's performance in controlling revenues and costs. C. Identify any costs excluded from the responsibility report and explain why they were excluded.
4. Clarke Inc. operates the Patio Furniture Division as a profit center. Operating data for this division for the year ended December 31, 202o, are as shown below. Difference from Budget Budget Sales $2,500,000 $50,000 F Cost of goods sold Variable 1,300,000 41,000 F Controllable fixed 200,000 3,000 U Selling and administrative Variable 220,000 6,000 U Controllable fixed 50,000 2,000 U Noncontrollable fixed direct oy 70,000 4,000 U costs In addition, Clarke incurs $180,000 of indirect fixed costs that were budgeted at $175,000. Twenty percent (20%) of these costs are allocated to the Patio Furniture Division. Instructions a. Prepare a responsibility report for the Patio Furniture Division for the year. b. Comment on the manager's performance in controlling revenues and costs. C. Identify any costs excluded from the responsibility report and explain why they were excluded.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
![4.
Clarke Inc. operates the Patio Furniture Division as a profit center. Operating data
for this division for the year ended December 31, 202o, are as shown below.
Difference from
Budget
Budget
Sales
$2,500,000
$50,000 F
Cost of goods sold
Variable
1,300,000
41,000 F
Controllable fixed
200,000
3,000 U
Selling and administrative
Variable
220,000
6,000 U
Controllable fixed
50,000
2,000 U
Noncontrollable fixed
direct oy
70,000
4,000 U
costs
In addition, Clarke incurs $180,000 of indirect fixed costs that were budgeted at
$175,000. Twenty percent (20%) of these costs are allocated to the Patio Furniture
Division.
Instructions
a.
Prepare a responsibility report for the Patio Furniture Division for the year.
b.
Comment on the manager's performance in controlling revenues and costs.
C.
Identify any costs excluded from the responsibility report and explain why they were
excluded.](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2F8142cc9d-12e4-4dde-a0b8-8404f6422c31%2Fb5a92bbe-97ab-490a-9517-b5bec3e4cf79%2Fgvn3gnr.jpeg&w=3840&q=75)
Transcribed Image Text:4.
Clarke Inc. operates the Patio Furniture Division as a profit center. Operating data
for this division for the year ended December 31, 202o, are as shown below.
Difference from
Budget
Budget
Sales
$2,500,000
$50,000 F
Cost of goods sold
Variable
1,300,000
41,000 F
Controllable fixed
200,000
3,000 U
Selling and administrative
Variable
220,000
6,000 U
Controllable fixed
50,000
2,000 U
Noncontrollable fixed
direct oy
70,000
4,000 U
costs
In addition, Clarke incurs $180,000 of indirect fixed costs that were budgeted at
$175,000. Twenty percent (20%) of these costs are allocated to the Patio Furniture
Division.
Instructions
a.
Prepare a responsibility report for the Patio Furniture Division for the year.
b.
Comment on the manager's performance in controlling revenues and costs.
C.
Identify any costs excluded from the responsibility report and explain why they were
excluded.
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