Friday Night, Inc. manufactures high-quality 5-liter boNES of wine which it sells for $14 per box. Below is some information related to Friday Night's capacity and budgeted manufacturing costs for 2021: Days of Hours of Denominator Level Capacity Concept Fixed Manufacturing Production ProductionBoxes per Overhead per Period per Perlod per Day Hour Theoretical capacity Practical capacity Normal capacity Master budget capacity $2,500,000 $2.500.000 $2,500.000 $2.500,000 362 310 300 250 22 16 175 200 310 16 310 16 Production during 2021 was 990,000 boxes of wine, with 15,000 remaining in ending Inventory at 12/31/21. Actual variable manufacturing costs were $1,762,200 (there are no varlable cost variances). Actual fed manufacturing overhead conts were $2.500.000. Fied manufacturing overhead cost variances are written off to cost of goods sold in the period in which they occur. What is gross margin under practical capacity? Hint: don't forget the production-volume variance O $9.457,700 $9.430,250 $9,444,000 $9,452,300 O000
Friday Night, Inc. manufactures high-quality 5-liter boNES of wine which it sells for $14 per box. Below is some information related to Friday Night's capacity and budgeted manufacturing costs for 2021: Days of Hours of Denominator Level Capacity Concept Fixed Manufacturing Production ProductionBoxes per Overhead per Period per Perlod per Day Hour Theoretical capacity Practical capacity Normal capacity Master budget capacity $2,500,000 $2.500.000 $2,500.000 $2.500,000 362 310 300 250 22 16 175 200 310 16 310 16 Production during 2021 was 990,000 boxes of wine, with 15,000 remaining in ending Inventory at 12/31/21. Actual variable manufacturing costs were $1,762,200 (there are no varlable cost variances). Actual fed manufacturing overhead conts were $2.500.000. Fied manufacturing overhead cost variances are written off to cost of goods sold in the period in which they occur. What is gross margin under practical capacity? Hint: don't forget the production-volume variance O $9.457,700 $9.430,250 $9,444,000 $9,452,300 O000
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Question
Transcribed Image Text:Friday Night, Inc. manufactures high-quality 5-liter boxes of wine which It sells for $14 per box. Below is some information related to Friday Night's capacity and budgeted foed
marufacturing costs for 2021;
Denominator Level Capacity
Concept
Days of Hours of
Fixed Manufacturing Production ProductionBoxes per
Overhead per Period per Perlod
per Day
Hour
Theoretical capacity
Practical capacity
Normal capacity
Master budget capacity
$2,500,000
$2.500.000
$2,500.000
$2.500,000
22
300
362
310
310
310
16
250
175
16
16
200
Production during 2021 was 990,000 boxes of wine, with 15,000 remaining in ending inventory at 12/31/21. Actual varlable manufacturing costs were $1,762,200 (there are no
varlable cost variances). Actual foed manufacturing overhead costs were $2.500.000. Fixed manufacturing overhead cost variances are written off to cost of goods sold in the
period in which they occur. What is gross margin under practical capacity? Hint: don't forget the production-volume variance
$9,457,700
$9.430.250
$9,444,800
$9452.300
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