I. The actual information pertains to the month of August. As part of the budgeting proAlloway's Fencing Company developed the following static budget for August. Allow:in the process of preparing the flexible budget and understanding the results.ActualFlexibleStaticResultsBudgetBudget25,000Sales volume (in units)20,000Sales revenues$1,000,000512,000$$$1,250,000Variable costs600,000Contribution margin488,000$650,000Fixed costs458,000$450,000Operating profit$30,000$$ 200,000Required:Prepare the flexible budget and state the flexible budget variances for variable costand fixed cost.

Solution: Preparation of flexible budget and flexible budget variances are as under:

Answered: I. The actual information pertains to…

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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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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The budget director of Gold Medal Athletic Co., with the assistance of the controller, treasurer, production manager, and sales manager, has gathered the following data for use in developing the budgeted income statement for March: Estimated sales for March: Batting helmet 1,200 units at $40 per unit Football helmet 6,500 units at $160 per unit Estimated inventories at March 1: Direct materials: Plastic 90 lb. Foam lining 80 lb. Finished products: Batting helmet 40 units at $25 per unit Football helmet 240 units at $77 per unit Desired inventories at March 31: Direct materials: Plastic 50 lb. Foam lining 65 lb. Finished products: Batting helmet 50 units at $25 per unit Football helmet 220 units at $78 per unit Direct materials used in production: In manufacture of batting helmet: Plastic 1.20 lb. per unit of product Foam lining 0.50 lb. per unit of product In manufacture of football helmet: Plastic 3.50 lb.…
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