Arrasmith Corporation uses customers served as its measure of activity. During February, the company budgeted for 35,500 customers, but actually served 31,000 customers. The company uses the following revenue and cost formulas in its budgeting, where q is the number of customers served: Revenue: $4.00q Wages and salaries: $33,700 + $1.25g Supplies: $0.65q Insurance: $10,900 Miscellaneous expenses: $6,900 + $0.35q The company reported the following actual results for February: $129,800 $ 68,500 $ 14,900 $ 10,900 $ 20,200 Revenue Wages and salaries Supplies Insurance Miscellaneous expense Required: Prepare the company's flexible budget performance report for February. Label each variance as favorable (F) or unfavorable (U). (Indicate the effect of each yariance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero

Arrasmith Corporation uses customers served as its measure of activity. During February, the company budgeted for 35,500 customers, but actually served 31,000 customers. The company uses the following revenue and cost formulas in its budgeting, where q is the number of customers served: Revenue: $4.00q Wages and salaries: $33,700 + $1.25g Supplies: $0.65q Insurance: $10,900 Miscellaneous expenses: $6,900 + $0.35q The company reported the following actual results for February: $129,800 $ 68,500 $ 14,900 $ 10,900 $ 20,200 Revenue Wages and salaries Supplies Insurance Miscellaneous expense Required: Prepare the company's flexible budget performance report for February. Label each variance as favorable (F) or unfavorable (U). (Indicate the effect of each yariance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Gordin Kennel uses tenant-days as its measure of activity, an animal housed in the kennel for one day is counted as one tenant-day. During May, the kennel budgeted for 3,000 tenant-days, but its actual level of activity was 3,020 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for May: Data used in budgeting: Revenue Wages and salaries Food and supplies Facility expenses Administrative expenses Total expenses Actual results for May: Multiple Choice Revenue $ 86,322 Wages and salaries $ 17,984 Food and supplies $ 32,444 Facility expenses $ 19,554 Administrative expenses $ 6,162 The spending variance for food and supplies in May would be closest to: O $840 U O Fixed element per month $0 $ 2,000 $840 F 800 8,500 6,000 $ 17,300 Variable element per tenant-day $ 27.60 $ 5.20 10.20 3.70 0.10 $19.20
Trevorrow Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During June, the company budgeted for 6,200 units, but its actual level of activity was 6,160 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for June: Data used in budgeting: Fixed element Variable element per month per unit Revenue $ 0 $ 0 $ 27.80 $ 3.10 Direct labor Direct materials 10.20 Manufacturing overhead 37,200 1.10 Selling and administrative expenses 22,800 0.30 Total expenses $ 60,000 $ 14.70 Actual results for June: Revenue $ 178,318 $ 18,606 $ 60,652 $ 43,896 $ 24,688 Direct labor Direct materials Manufacturing overhead Selling and administrative expenses The activity variance for net operating income in June would be closest to:
Leist Clinic uses client-visits as its measure of activity. During September, the clinic budgeted for 2,200 client-visits, but its actual level of activity was 2,170 client-visits. The clinic has provided the following data concerning the formulas to be used in its budgeting: Fixed element per month Variable element per client-visit Revenue $ 0 $ 50.80 Personnel expenses $ 26,600 $ 15.60 Medical supplies 1,400 9.40 Occupancy expenses 7,600 2.40 Administrative expenses 5,300 0.10 Total expenses $ 40,900 $ 27.50 The occupancy expenses in the flexible budget for September would be closest to: Multiple Choice A. $13,215 B. 12,808 C. $13,583 D. $12,880
Arrasmith Corporation uses customers served as its measure of activity. During February, the company budgeted for 36.100 customers, but actually served 27.900 customers. The company uses the following revenue and cost formules in its budgeting, where is the number of customers served: Revenue: $4.60q Wages and salaries: $34,300+ $1.43q Supplies: $0.83q Insurance: $11,500 Miscellaneous expenses: $7,500 + $0.41q The company reported the following actual results for February: $ 141,800 $ 69,100 $ 15,500 $ 11,500 $ 23,200 Revenue Wages and salaries Supplies Insurance Miscellaneous expense Required: Prepare the company's flexible budget performance report for February. Label each variance as favorable (F) or unfavorable (U). Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (.e., zero variance). Input all amounts as positive values. Customers served Revenue Expenses: Wages and salaries Supplies Insurance Miscellaneous…
Trevorrow Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During June, the company budgeted for 5,900 units, but its actual level of activity was 5,860 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for June: Data used in budgeting: Fixed element per month Variable element per unit Revenue $ 0 $ 29.30 Direct labor $ 0 $ 3.90 Direct materials 0 10.00 Manufacturing overhead 39,000 1.20 Selling and administrative expenses 24,600 0.40 Total expenses $ 63,600 $ 15.50 Actual results for June: Revenue $ 176,358 Direct labor $ 22,310 Direct materials $ 56,330 Manufacturing overhead $ 45,917 Selling and administrative expenses $ 26,989 The overall revenue and spending variance (i.e., the variance for net operating income in the revenue and spending variance column on the flexible budget…
i Required information [The following information applies to the questions displayed below] Adger Corporation is a service company that measures its output based on the number of customers served. The company provided the following fixed and variable cost estimates that it uses for budgeting purposes and the actual results for May as shown below: Revenue Employee salaries and wages Travel expenses Other expenses Fixed Element per Month Variable Element per Customer Served Actual Total for May $ 6,600 $ 213,500 $ 62,000 $ 2,300 $ 141,100 $ 540 $ 15,700 $ 41,000 $ 38,900 When preparing its planning budget the company estimated that it would serve 30 customers per month; however, during May the company actually served 35 customers. 5. What activity variances would Adger report with respect to each of its expenses for May? (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive…
Summer Corporation is an oil well service company that measures its output by the number of wells serviced. The company has provided the following fixed and variable cost estimates that it uses for budgeting purposes. Revenue Employee salaries and wages Servicing materials Other expenses O $87,000 $88,750 Fixed Element per Month O $90,650 O $89,888 S 57,400 S 35,400 When the company prepared its planning budget at the beginning of December, it assumed that 35 wells would have been serviced. However, 33 wells were actually serviced during December. The "Employee salaries and wages" in the flexible budget for December would have been closest to: Variable Element per Well Serviced. S S 4,500 950 700
Bartosiewicz Clinic uses client-visits as its measure of activity. During January, the clinic budgeted for 4,000 client-visits, but its actual level of activity was 3,980 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for January: Data used in budgeting: Fixed element per month Variable element per client-visit Revenue - $ 36.00 Personnel expenses $ 28,000 $ 12.00 Medical supplies 2,000 6.00 Occupancy expenses 11,000 1.00 Administrative expenses 7,000 0.10 Total expenses $ 48,000 $ 19.10 Actual results for January: Revenue $ 124,750 Personnel expenses $ 70,500 Medical supplies $ 21,050 Occupancy expenses $ 14,000 Administrative expenses $ 7,850 The overall revenue and spending variance (i.e., the variance for net operating income in the revenue and spending variance column on the flexible budget performance…
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 6,400 units, but its actual level of activity was 6,350 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: Fixed element per month Variable element per unit Revenue $ 0 $ 33.90 Direct labor $ 0 $ 5.90 Direct materials 0 13.50 Manufacturing overhead 34,000 1.40 Selling and administrative expenses 25,200 0.60 Total expenses $ 59,200 $ 21.40 Actual results for May: Revenue $ 216,300 Direct labor $ 36,930 Direct materials $ 86,900 Manufacturing overhead $ 42,000 Selling and administrative expenses $ 30,440 The revenue variance for May would be closest to:
Shaak Corporation uses customers served as its measure of activity. The company bases its budgets on the following information: Revenue should be $4.20 per customer served. Wages and salaries should be $21,800 per month plus $1.00 per customer served. Supplies should be $0.70 per customer served. Insurance should be $5,700 per month, Miscellaneous expenses should be $3,900 per month plus $0.30 per customer served. The company reported the following actual results for October: Customers served Revenue Wages and salaries Supplies Insurance Miscellaneous expense Required: 22,500 $ 137,300 $ 40,600 $ 16,300 $ 5,580 $ 7,480 Prepare a report showing the company's revenue and spending variances for October. Label each variance as favorable (F) or unfavorable (U). Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values. Shaak Corporation Revenue and Spending Variances…
Kirnon Clinic uses client-visits as its measure of activity. During July, the clinic budgeted for 2,000 client-visits, but its actual level of activity was 2,010 client-visits. The clinic has provided the following data concerning the formulas to be used in its budgeting: Fixed element per month Variable element per client-visit Revenue $ 0 $ 43.70 Personnel expenses $ 26,100 $ 12.10 Medical supplies 1,000 6.30 Occupancy expenses 6,800 1.60 Administrative expenses 3,000 0.20 Total expenses $ 36,900 $ 20.20 The activity variance for net operating income in July would be closest to: Multiple Choice A. $235 F B. $235 U C. $2,825 F D. $2,825 U
Bartosiewicz Clinic uses client-visits as its measure of activity. During January, the clinic budgeted for 4,600 client-visits, but its actual level of activity was 4,580 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for January: Data used in budgeting: Revenue Personnel expenses Medical supplies Occupancy expenses Administrative expenses Total expenses Actual results for January: Revenue Personnel expenses Medical supplies Occupancy expenses Administrative expenses Fixed element Variable element per month $0 $ 28,600 1,500 10,500 7,600 $ 48,200 $ 130,000 $ 70,020 $ 21,012 $ 13,190 $ 7,440 per client-visit $36.60 $ 12.60 6.60 1.00 0.20 $ 20.40 The overall revenue and spending variance (i.e., the variance for net operating income in the revenue and spending variance column on the flexible budget performance report) for January would be closest to: