Paynesville Corporation manufactures and sells a preservative used in food and drug manufacturing. The company carries noinventories. The master budget calls for the company to manufacture and sell 122,000 liters at a budgeted price of $240 per liter thisyear. The standard direct cost sheet for one liter of the preservative follows.(2 pounds @ $15)(0.5 hours @ $46)Direct materials$30Direct labor23Variable overhead is applied based on direct labor hours. The variable overhead rate is $130 per direct-labor hour. The fixed overheadrate (at the master budget level of activity) is $65 per unit. All non-manufacturing costs are fixed and are budgeted at $2.3 million forthe coming year.esAt the end of the year, the costs analyst reported that the sales activity variance for the year was $732,000 unfavorable.RequiredPrepare a flexible budget for Paynesville for the year. (Enter your answers in thousands of dollars.) Prepare a Tiexibie buaget for PaynesVIIie for the year. (Enter your answers in thousanas or aollars.)PAYNESVILLE CORPORATIONFlexible Budget(thousands of dollars)Sales revenue$ 29,280,000Variable costs:MaterialsDirect laborVariable overheadcesNon-manufacturingTotal variable costs$4Contribution margin$ 29,280,000Fixed costs:Manufacturing overheadNon-manufacturingTotal fixed costsOperating profits$ 29 280 000

Paynesville Corporation manufactures and sells a preservative used in food and drug manufacturing. The inventories. The master budget calls for the company to manufacture and sell 122,000 liters at a budgeted price of $240 per liter this year. The standard direct cost sheet for one liter of the preservative follows. Direct materials (2 pounds @ $15) (0.5 hours @ $46) $30 Direct labor 23 Variable overhead is applied based on direct labor hours. The variable overhead rate is $130 per direct-labor hour. The fixed overheac rate (at the master budget level of activity) is $65 per unit. All non-manufacturing costs are fixed and are budgeted at $2.3 million for the coming year. At the end of the year, the costs analyst reported that the sales activity variance for the year was $732,000 unfavorable. Required Prepare a flexible budget for Paynesville for the year. (Enter your answers in thousands of dollars.)

Paynesville Corporation manufactures and sells a preservative used in food and drug manufacturing. The inventories. The master budget calls for the company to manufacture and sell 122,000 liters at a budgeted price of $240 per liter this year. The standard direct cost sheet for one liter of the preservative follows. Direct materials (2 pounds @ $15) (0.5 hours @ $46) $30 Direct labor 23 Variable overhead is applied based on direct labor hours. The variable overhead rate is $130 per direct-labor hour. The fixed overheac rate (at the master budget level of activity) is $65 per unit. All non-manufacturing costs are fixed and are budgeted at $2.3 million for the coming year. At the end of the year, the costs analyst reported that the sales activity variance for the year was $732,000 unfavorable. Required Prepare a flexible budget for Paynesville for the year. (Enter your answers in thousands of dollars.)

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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