Preparing a flexible budget and performance reportThis continues the Piedmont Computer Company situation from Chapter 22. Assume Piedmont Computer Company has created a standard cost card for the PCC model tablet computer, with overhead allocated based on direct labor hours:During the month of September, Piedmont Computer Company incurred the following costs while manufacturing 1,100 PCC model tablets;RequirementsPrepare a flexible budget for September for 900, 1,000, and 1,100 PCC model tablets. The tablet has a standard sales price of $675. List variable costs separately.Using 1,000 PCC model tablets for the static budget, prepare a flexible budget performance report for September. Total sales revenue for the month was $767,800. The company sold 1,100 tablets.What insights can the management of Piedmont Computer Company draw from the performance report? Direct materialsDirect laborVariable overheadFixed overhead$ 300 per tablet3 hours per tablet at $26 per hour3 hours per tablet at $5 per hour$54,000 per month Direct materialsDirect laborVariable overheadFixed overhead$ 341,00088,00017,60056,320

Flexible Budget: A flexible budget is a budget that is prepared for different levels of the output.…

Answered: Direct materials Direct labor Variable…

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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Preparing a flexible budget and performance report

This continues the Piedmont Computer Company situation from Chapter 22. Assume Piedmont Computer Company has created a standard cost card for the PCC model tablet computer, with overhead allocated based on direct labor hours:

During the month of September, Piedmont Computer Company incurred the following costs while manufacturing 1,100 PCC model tablets;

Requirements

Prepare a flexible budget for September for 900, 1,000, and 1,100 PCC model tablets. The tablet has a standard sales price of $675. List variable costs separately.
Using 1,000 PCC model tablets for the static budget, prepare a flexible budget performance report for September. Total sales revenue for the month was $767,800. The company sold 1,100 tablets.
What insights can the management of Piedmont Computer Company draw from the performance report?

Direct materials
Direct labor
Variable overhead
Fixed overhead
$ 300 per tablet
3 hours per tablet at $26 per hour
3 hours per tablet at $5 per hour
$54,000 per month

Direct materials
Direct labor
Variable overhead
Fixed overhead
$ 341,000
88,000
17,600
56,320

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