Nottingham Forest Products reports the following information concerning operations for the most recent month: Actual (based on actual sales of 4,800 units) Master Budget (based on budgeted sales of 4,000 units) Sales revenue $ 228,700 $ 188,000 Less Manufacturing costs Direct labor 50,302 39,000 Materials 31,520 27,200 Variable overhead 16,608 13,100 Marketing 7,805 6,200 Administrative 7,215 6,500 Total variable costs $ 113,450 $ 92,000 Contribution margin $ 115,250 $ 96,000 Fixed costs Manufacturing 38,930 37,400 Marketing 14,860 12,200 **Nottingham Forest Products: Flexible Budget**This document outlines the flexible budget of Nottingham Forest Products. A flexible budget adjusts for different levels of activity, providing a more accurate reflection of costs and revenues than a static budget.**Categories in the Flexible Budget:**1. **Sales Revenue** - Represents the income from sales of products or services.2. **Variable Costs:** - **Manufacturing Costs:** - **Direct Labor:** Costs directly associated with the employees producing goods. - **Materials:** Costs of raw materials used in production. - **Variable Overhead:** Indirect production costs that vary with output. - **Marketing:** Costs related to advertising and promoting products. - **Administrative:** General and administrative costs that vary with activity levels. - **Total Variable Costs:** - Sum of all variable costs.3. **Contribution Margin** - Sales revenue minus total variable costs. It’s used to cover fixed costs and generate profit.4. **Less Fixed Costs:** - **Manufacturing:** Permanent production-related expenses that do not change with activity levels. - **Marketing:** Fixed expenses related to marketing efforts. - **Administrative:** Fixed overhead costs such as salaries and utilities. - **Total Fixed Costs:** - Sum of all fixed costs.5. **Operating Profit** - Contribution margin after subtracting total fixed costs.This budget sheet helps in analyzing the financial performance of Nottingham Forest Products by comparing expected and actual revenues and costs.

Name: Nottingham Forest Products reports the following information concerni
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Description: Nottingham Forest Products reports the following information concerning operations for the most recent month: Actual (based on actual sales of 4,800 units) Master Budget (based on budgeted sales of 4,000 units) Sales revenue $

The fleixible budget is based on standard rates for actual level of production. The contribution…

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Nottingham Forest Products reports the following information concerning operations for the most recent mont Master Budget (based on budgeted sales of 4,000 units) $ 188,000 Sales revenue Less Manufacturing costs Direct labor Materials Variable overhead Marketing Administrative Total variable costs Contribution margin Fixed costs Manufacturing Actual (based on actual sales of 4,800 units) $ 228,700 50,302 31,520 16,608 7,805 7,215 $ 113,450 $ 115,250 38,930 39,000 27, 200 13,100 6,200 6,500 $ 92,000 $ 96,000 37,400

Nottingham Forest Products reports the following information concerning operations for the most recent mont Master Budget (based on budgeted sales of 4,000 units) $ 188,000 Sales revenue Less Manufacturing costs Direct labor Materials Variable overhead Marketing Administrative Total variable costs Contribution margin Fixed costs Manufacturing Actual (based on actual sales of 4,800 units) $ 228,700 50,302 31,520 16,608 7,805 7,215 $ 113,450 $ 115,250 38,930 39,000 27, 200 13,100 6,200 6,500 $ 92,000 $ 96,000 37,400

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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