Arctica manufactures snowmobiles and ATVs. These products are made in different departments, and each department has it
Arctica manufactures snowmobiles and ATVs. These products are made in different departments, and each department has it
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Question
Exercise 22-1 Responsibility accounting report—cost center LO P1
Arctica manufactures snowmobiles and ATVs. These products are made in different departments, and each department has its own manager. Each responsibility performance report only includes those costs that the particular department manager can control: raw materials, wages, supplies used, and equipment
| Budget | Actual | |||||||||||||||||||||||
| Snowmobile | ATV | Combined | Snowmobile | ATV | Combined | |||||||||||||||||||
| Raw materials | $ | 19,500 | $ | 27,500 | $ | 47,000 | $ | 19,420 | $ | 28,820 | $ | 48,240 | ||||||||||||
| Employee wages | 10,400 | 20,500 | 30,900 | 10,660 | 21,240 | 31,900 | ||||||||||||||||||
| Dept. manager salary | 4,300 | 5,200 | 9,500 | 4,400 | 4,400 | 8,800 | ||||||||||||||||||
| Supplies used | 3,300 | 900 | 4,200 | 3,170 | 920 | 4,090 | ||||||||||||||||||
| Depreciation-Equip. | 6,000 | 12,500 | 18,500 | 6,000 | 12,500 | 18,500 | ||||||||||||||||||
| Utilities | 360 | 540 | 900 | 330 | 500 | 830 | ||||||||||||||||||
| Rent | 5,700 | 6,300 | 12,000 | 5,300 | 6,300 | 11,600 | ||||||||||||||||||
| Totals | $ | 49,560 | $ | 73,440 | $ | 123,000 | $ | 49,280 | $ | 74,680 | $ | 123,960 | ||||||||||||
Prepare a responsibility accounting report for the snowmobile department. (Under budget amounts should be indicated by a minus sign.)
Transcribed Image Text:**Exercise 22-1 Responsibility Accounting Report — Cost Center LO P1**
Arctica manufactures snowmobiles and ATVs. These products are made in different departments, and each department has its own manager. Each responsibility performance report only includes those costs that the particular department manager can control: raw materials, wages, supplies used, and equipment depreciation.
### Budget vs. Actual Costs Table:
| | Budget | Actual |
|----------------------------|---------------------------------------------|---------------------------------------------|
| | Snowmobile | ATV | Combined | Snowmobile | ATV | Combined |
| Raw materials | $19,500 | $27,500 | $47,000 | $19,420 | $28,820 | $48,240 |
| Employee wages | $10,400 | $20,500 | $30,900 | $10,660 | $21,240 | $31,900 |
| Dept. manager salary | $4,300 | $5,200 | $9,500 | $4,400 | $4,400 | $8,800 |
| Supplies used | $3,300 | $900 | $4,200 | $3,170 | $920 | $4,090 |
| Depreciation-Equip. | $6,000 | $12,500 | $18,500 | $6,000 | $12,500 | $18,500 |
| Utilities | $360 | $540 | $900 | $330 | $500 | $830 |
| Rent | $5,700 | $6,300 | $12,000 | $5,300 | $6,300 | $11,600 |
| **Totals** | **$49,560** | **$73,440** | **$123,000** | **$49,280** | **$74,680** | **$123,960** |
### Instructions
Prepare a responsibility accounting report for the snowmobile department. (Under budget amounts should be indicated by a minus sign.)
### Responsibility Accounting Performance Report
**Dept. Manager, Snowmobile Department**
**For the Year**
| Controllable Costs | Budgeted Amount | Actual Amount | Over (
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