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K&B is a small management consulting firm. Last month, the firm billed fewer hours than expected, and, as expected, profits were lower than anticipated. Billable hoursa 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 sales activity variance analysis. (Do not round intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option.) Total costs Reported Income Profit Statement 11,500 $1,230,000 685,000 170,000 300,000 $ 75,000 Flexible Budget (based on actual of 11,500 hours) Master Budget 10,000 $1,200,000 630,000 160,000 310,000 $ 100,000 Master Budget Sales Activity Variance (based on budgeted 10,000 hours)

K&B is a small management consulting firm. Last month, the firm billed fewer hours than expected, and, as expected, profits were lower than anticipated. Billable hoursa 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 sales activity variance analysis. (Do not round intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option.) Total costs Reported Income Profit Statement 11,500 $1,230,000 685,000 170,000 300,000 $ 75,000 Flexible Budget (based on actual of 11,500 hours) Master Budget 10,000 $1,200,000 630,000 160,000 310,000 $ 100,000 Master Budget Sales Activity Variance (based on budgeted 10,000 hours)

FINANCIAL ACCOUNTING
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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Subject: acounting 

K&B is a small management consulting firm. Last month, the firm billed fewer hours than expected, and, as expected, profits were lower than anticipated. Billable hoursa Revenue Professional salaries (all variable) Other variable costs (e.g., supplies, computer services) Fixed costs Profit aThese 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. Revenue Costs: Required: Prepare a sales activity variance analysis. (Do not round intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option.) Professional salaries Other variable costs Fixed costs Reported Income Statement 11,500 $1,230,000 685,000 170,000 300,000 75,000 Total costs Profit Master Budget 10,000 $1,200,000 630,000 160,000 310,000 $ 100,000 Master Budget Flexible Budget (based on actual of Sales Activity Variance (based on budgeted 11,500 hours) 10,000 hours)
Transcribed Image Text:K&B is a small management consulting firm. Last month, the firm billed fewer hours than expected, and, as expected, profits were lower than anticipated. Billable hoursa Revenue Professional salaries (all variable) Other variable costs (e.g., supplies, computer services) Fixed costs Profit aThese 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. Revenue Costs: Required: Prepare a sales activity variance analysis. (Do not round intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option.) Professional salaries Other variable costs Fixed costs Reported Income Statement 11,500 $1,230,000 685,000 170,000 300,000 75,000 Total costs Profit Master Budget 10,000 $1,200,000 630,000 160,000 310,000 $ 100,000 Master Budget Flexible Budget (based on actual of Sales Activity Variance (based on budgeted 11,500 hours) 10,000 hours)
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