Franklin Publications established the following standard price and costs for a hardcover picture book that the company produces. Standard price and variable costs. Sales price Materials cost Labor cost Overhead cost Selling, general, and administrative costs Planned fixed costs Manufacturing overhead Selling, general, and administrative $36.20 8.30 3.60 6.10 6.40 $126,000 46,000 Franklin planned to make and sell 24,000 copies of the book. Required: a. - d. Prepare the pro forma income statement that would appear in the master budget and also flexible budget income statements, assuming production volumes of 23,000 and 25,000 units. Determine the sales and variable cost volume variances, assuming volume is actually 25,000 units. Indicate whether the variances are favorable (F) or unfavorable (U). (Select "None" if there is no effect (i.e., zero variance).)
Franklin Publications established the following standard price and costs for a hardcover picture book that the company produces. Standard price and variable costs. Sales price Materials cost Labor cost Overhead cost Selling, general, and administrative costs Planned fixed costs Manufacturing overhead Selling, general, and administrative $36.20 8.30 3.60 6.10 6.40 $126,000 46,000 Franklin planned to make and sell 24,000 copies of the book. Required: a. - d. Prepare the pro forma income statement that would appear in the master budget and also flexible budget income statements, assuming production volumes of 23,000 and 25,000 units. Determine the sales and variable cost volume variances, assuming volume is actually 25,000 units. Indicate whether the variances are favorable (F) or unfavorable (U). (Select "None" if there is no effect (i.e., zero variance).)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Don't give answer in image format
Transcribed Image Text:Franklin Publications established the following standard price and costs for a hardcover picture book that the company produces.
Standard price and variable costs
Sales price
Materials cost
Labor cost
Overhead cost
Selling, general, and administrative costs
Planned fixed costs.
Manufacturing overhead
Selling, general, and administrative
$36.20
8.30
3.60
6.10
6.40
$126,000
46,000
Franklin planned to make and sell 24,000 copies of the book.
Required:
a. d. Prepare the pro forma income statement that would appear in the master budget and also flexible budget income statements,
assuming production volumes of 23,000 and 25,000 units. Determine the sales and variable cost volume variances, assuming volume
is actually 25,000 units. Indicate whether the variances are favorable (F) or unfavorable (U). (Select "None" if there is no effect (i.e.,
zero variance).)
Transcribed Image Text:Number of units
Sales revenue
Variable manufacturing costs
Materials
Labor
Manufacturing overhead
Variable selling general, and administrative costs
Contribution margin
Fixed costs
Manufacturing overhead
Variable selling general, and administrative costs
Net income
Master Budget
24,000
$
0
0 $
Flexible Budgets
23,000
0
0
S
25,000
0
0
Volume Variances
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
This is a popular solution!
Trending now
This is a popular solution!
Step by step
Solved in 3 steps
Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education