Before the year began, the following static budget was developed for the estimated sales of 100,000. Sales are sluggish and management needs to revise its budget. Use this information to prepare a flexible budget for 80,000 and 90,000 units of sales. Flexible Budget Sales Cost of Goods Sold Direct Material Direct Labor Variable Manufacturing Overhead Fixed Manufacturing Overhead Cost of Goods Sold Gross Profit Variable Sales and Administrative Expenses Fixed Sales and Administrative Expenses Income Before Taxes Taxes Net Income/Loss 100,000 80,000 90,000 $3,370,000 $ $900,000 $ 900,000 230,000 70,000 $2,100,000 $ $1,270,000 100,000 960,000 $210,000 $ 63,000 $147,000 $ $ $

Before the year began, the following static budget was developed for the estimated sales of 100,000. Sales are sluggish and management needs to revise its budget. Use this information to prepare a flexible budget for 80,000 and 90,000 units of sales. Flexible Budget Sales Cost of Goods Sold Direct Material Direct Labor Variable Manufacturing Overhead Fixed Manufacturing Overhead Cost of Goods Sold Gross Profit Variable Sales and Administrative Expenses Fixed Sales and Administrative Expenses Income Before Taxes Taxes Net Income/Loss 100,000 80,000 90,000 $3,370,000 $ $900,000 $ 900,000 230,000 70,000 $2,100,000 $ $1,270,000 100,000 960,000 $210,000 $ 63,000 $147,000 $ $ $

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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Reflector Glass Company prepared the following static budget for the year: Static Budget Units/Volume Sales Revenue Variable Costs Contribution Margin Fixed Costs Operating Income/(Loss) 5,000 Per Unit $3 $15,000 1.5 7,500 7,500 3,000 $4,500 If a flexible budget is prepared at a volume of 8,500 units, calculate the amount of operating income. The production level is within the relevant range. OA. $9,750 B. $12,750 OC. $3,000 OD. $4,500
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Before the year began, the following static budget was developed for the estimated sales of 100,000. Sales are sluggish and management needs to revise its budget. Use this information to prepare a flexible budget for 80,000 and 90,000 units of sales. Flexible Budget 100,000 80,000 90,000 Sales $3,580,000 $fill in the blank 1 $fill in the blank 2 Cost of Goods Sold Direct Material $900,000 $fill in the blank 3 $fill in the blank 4 Direct Labor 1,100,000 fill in the blank 5 fill in the blank 6 Variable Manufacturing Overhead 240,000 fill in the blank 7 fill in the blank 8 Fixed Manufacturing Overhead 70,000 fill in the blank 9 fill in the blank 10 Cost of Goods Sold $2,310,000 $fill in the blank 11 $fill in the blank 12 Gross Profit $1,270,000 $fill in the blank 13 $fill in the blank 14 Variable Sales and Administrative Expenses 100,000 fill in the blank 15 fill in the blank 16 Fixed Sales and Administrative Expenses 940,000 fill in the blank…
Lincoln Corporation used the following data to evaluate their current operating system. The company sells items for $12 each and used a budgeted selling price of $12 per unit. Actual Budgeted Units sold 42,000 units 36,000 units Variable costs $168,000 $151,000 $58,000 Fixed costs $45,000 What is the static-budget variance of revenues? O A. $72,000 unfavorable OB. $6,000 unfavorable O C. $72,000 favorable O D. $4,000 favorable O Time Re esc
Amanda Manufacturing Company prepared the following static budget income statement: $ 476,000.00 (336,000.00) 140,000.00 (66,000.00) $ 74,000.00 Revenues Variable Costs Contribution Margin Fixed Costs Net Income The budgeted costs were based on a planned sales volume of 14,000 units. Actual production was 7,800 units. The amount of net income based on a flexible budget of 7,800 units would have been Multiple Choice $6.200.00 $12,000.00. Show Transcribed Text O $270,000.00 O $6,200.00. O O $12,000.00. $270,000.00. $4,200.00. J C
The actual information pertains to the third quarter. As part of the budgeting process, the Duck Decoy Department of Paralith Incorporated had developed the following static budget for the third quarter. Duck Decoy is in the process of preparing the flexible budget and understanding the results. Actual Results Flexible Budget Static Budget Sales volume (in units) 19,000 18,000 Sales revenues $240,000 $ $233,000 Variable costs 141,000 183,000 Contribution margin 99,000 50,000 Fixed costs 41,000 34,000 Operating profit $58,000 $ $16,000 The flexible budget will report ________ for the fixed costs. Do not give answer in image formate
The following dashboard shows information from a company's fixed budget for 12,000 units of production and sales, and actual results for 12,500 units of production and sales. Budgeted sales Actual sales Budgeted variable costs Actual variable costs Budgeted fixed costs $48,000 Actual fixed costs $46,000 Enter answers in the tabs below. Required 1 Required 2 $108,000 $137,500 Compute the flexible budget income at the actual production and sales level of 12,500 units. ------Flexible Budget------ ------Flexible Budget at ------ Variable Amount per Unit Total Fixed Cost 12,500 units Contribution margin $ 0 $ 0 0 $180,000 $195,000
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3. Before the year began, the following static budget was developed for the estimated sales of 100,000. Sales are sluggish and management needs to revise its budget. Use this information to prepare a flexible budget for 80,000 and 90,000 units of sales. Sales $3,500,000 Cost of goods sold Direct material 900,000 Direct labor 1,000,000 Variable manufacturing overhead Fixed manufacturing overhead Cost of goods sold Gross profit Variable sales and administration expenses Fixed sales and administration expenses 250,000 80,000 2,230,000 1,270,000 100,000 950,000 Income before taxes 220,000 Таxes 66,000 Net income $ 154,000
Cullumber's, Inc. has provided you with the following financial information: Budgeted Actual Sales Quantity 8,500 8,700 Sales price per unit $6.00 $5.75 Variable product cost per unit 2.00 2.25 Selling expense (fixed) 5,500 8,500 Administrative expense (fixed) 17,500 16,500 Income tax expense 4,300 4,500 Prepare a flexible budget. CULLUMBER'S, INC. Flexible Budget $ $
Budgets Question 1. A manager had the following operating budget and achieved the actual results shown. Calculate the variance and variance percentage for each line item. Then answer the questions that follow. Sales Budget Actual Variance Food $500,000 $550,000 Beverage |50,000 165,000 $650,000 Total Sales Total Controllable Expense Total Fixed Expense 450,000 495,000 135,000 135,000 Profit (Loss) $65,000 What is your assessment of this operation's expense control performance during this budget period? 2. Why are managers who are skilled at controlling expenses in such high demand in the hospitality industry? W APR