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Exercise 17-38 (Algo) Flexible Budgeting, Service Organization (LO 17-6) Kentford Associates is a small professional services firm. Last month, Kentford billed more hours than expected and profits reflected this. Billable hours Revenue Professional salaries (all variable) Other variable costs (e.g., supplies, computer services) Fixed costs Profit Reported Income Statement 5,841 $ 1,196,000 524,000 177,600 260,000 $ 234,400 Flexible Budget Master Budget 5,436 $ 1,152,000 518,000 158,000 293.000 $ 183,000 *These are hours billed to clients. They are fewer than the number of hours worked because there is nonbillable time (e.g, slack periods, time in training sessions) and because some time worked for clients is not charged to them. Required: Prepare a flexible budget for Kentford. Use billable hours as the measure of output (that is, units produced). Note: Do not round intermediate calculations. Round your final answers to nearest whole dollar.

Exercise 17-38 (Algo) Flexible Budgeting, Service Organization (LO 17-6) Kentford Associates is a small professional services firm. Last month, Kentford billed more hours than expected and profits reflected this. Billable hours Revenue Professional salaries (all variable) Other variable costs (e.g., supplies, computer services) Fixed costs Profit Reported Income Statement 5,841 $ 1,196,000 524,000 177,600 260,000 $ 234,400 Flexible Budget Master Budget 5,436 $ 1,152,000 518,000 158,000 293.000 $ 183,000 *These are hours billed to clients. They are fewer than the number of hours worked because there is nonbillable time (e.g, slack periods, time in training sessions) and because some time worked for clients is not charged to them. Required: Prepare a flexible budget for Kentford. Use billable hours as the measure of output (that is, units produced). Note: Do not round intermediate calculations. Round your final answers to nearest whole dollar.

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Exercise 17-38 (Algo) Flexible Budgeting, Service Organization (LO 17-6) Kentford Associates is a small professional services firm. Last month, Kentford billed more hours than expected and profits reflected this. Billable hours Revenue Professional salaries (all variable). Other variable costs (e.g., supplies, computer services) Fixed costs Profit Revenue Costs "These are hours billed to clients. They are fewer than the number of hours worked because there is nonbillable time (e.g., slack periods, time in training sessions) and because some time worked for clients is not charged to them. Professional salaries Other variable costs Fixed costs Required: Prepare a flexible budget for Kentford. Use billable hours as the measure of output (that is, units produced). Note: Do not round intermediate calculations. Round your final answers to nearest whole dollar. Total costs Reported Income Statement Profit 5,841 $ 1,196,000 524,000 177,600 260,000 $ 234,400 Flexible Budget (based on actual of 5,841 hours) Master Budget 5,436 $ 1,152,000 518,000 158,000 293,000 $ 183,000
Transcribed Image Text:Exercise 17-38 (Algo) Flexible Budgeting, Service Organization (LO 17-6) Kentford Associates is a small professional services firm. Last month, Kentford billed more hours than expected and profits reflected this. Billable hours Revenue Professional salaries (all variable). Other variable costs (e.g., supplies, computer services) Fixed costs Profit Revenue Costs "These are hours billed to clients. They are fewer than the number of hours worked because there is nonbillable time (e.g., slack periods, time in training sessions) and because some time worked for clients is not charged to them. Professional salaries Other variable costs Fixed costs Required: Prepare a flexible budget for Kentford. Use billable hours as the measure of output (that is, units produced). Note: Do not round intermediate calculations. Round your final answers to nearest whole dollar. Total costs Reported Income Statement Profit 5,841 $ 1,196,000 524,000 177,600 260,000 $ 234,400 Flexible Budget (based on actual of 5,841 hours) Master Budget 5,436 $ 1,152,000 518,000 158,000 293,000 $ 183,000
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