Prepare and discuss a flexible budget report. E11.24 (LO 1, 2) As sales manager, Kajsa Keyser was given the following static budget report for selling expenses in the clothing department of Dunham Company for the month of October: Sales in units Variable costs Sales commissions Advertising expense Travel expense Free samples given out DUNHAM COMPANY Clothing Department Budget Report Month Ended October 31, 2022 Total variable costs Fixed costs Rent Sales salaries Office salaries Depreciation -vehicles (sales staff) Total fixed costs Total costs Budget Actual 8,000 10,000 $2,000 $ 2,700 800 900 2,400 2,600 1,600 1,500 6,800 1,500 1,000 800 500 3,800 $10,600 7,700 1,500 1,000 800 500 3,800 $11,500 Difference: Favourable (F)/ Unfavourable (U) 2,000 F $ 700 U 100 U 200 U 100 F 900 U -0- -0- -0- -0- -0- $ 900 U As a result of this budget report, Kajsa was called into the president's office and congratulated on her fine sales performance. She was reprimanded, however, for allowing her costs to get out of control. Kajsa knew something was wrong with the performance report that she had been given. However, she was not sure what to do and has come to you for advice. Instructions a. Prepare a budget report based on flexible budget data to help Kajsa. b. Should Kaisa have been reprimanded? Explain
Prepare and discuss a flexible budget report. E11.24 (LO 1, 2) As sales manager, Kajsa Keyser was given the following static budget report for selling expenses in the clothing department of Dunham Company for the month of October: Sales in units Variable costs Sales commissions Advertising expense Travel expense Free samples given out DUNHAM COMPANY Clothing Department Budget Report Month Ended October 31, 2022 Total variable costs Fixed costs Rent Sales salaries Office salaries Depreciation -vehicles (sales staff) Total fixed costs Total costs Budget Actual 8,000 10,000 $2,000 $ 2,700 800 900 2,400 2,600 1,600 1,500 6,800 1,500 1,000 800 500 3,800 $10,600 7,700 1,500 1,000 800 500 3,800 $11,500 Difference: Favourable (F)/ Unfavourable (U) 2,000 F $ 700 U 100 U 200 U 100 F 900 U -0- -0- -0- -0- -0- $ 900 U As a result of this budget report, Kajsa was called into the president's office and congratulated on her fine sales performance. She was reprimanded, however, for allowing her costs to get out of control. Kajsa knew something was wrong with the performance report that she had been given. However, she was not sure what to do and has come to you for advice. Instructions a. Prepare a budget report based on flexible budget data to help Kajsa. b. Should Kaisa have been reprimanded? Explain
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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pls explain thanks
Transcribed Image Text:Prepare and discuss a flexible budget report.
E11.24 (LO 1, 2) As sales manager, Kajsa Keyser was given the following static budget report for selling expenses in the
clothing department of Dunham Company for the month of October:
Sales in units
Variable costs
Sales commissions
Advertising expense
Travel expense
Free samples given
out
DUNHAM COMPANY
Clothing Department
Budget Report
Month Ended October 31, 2022
Total variable
costs
Fixed costs
Rent
Sales salaries
Office salaries
Depreciation
-vehicles (sales staff)
Total fixed costs
Total costs
Budget Actual
8,000 10,000
$ 2,000 $ 2,700
800
2,400
1,600
6,800
1,500
1,000
800
500
3,800
$10,600
900
2,600
1,500
7,700
1,500
1,000
800
500
3,800
$11,500
Difference:
Favourable (F)/
Unfavourable (U)
2,000 F
$ 700 U
100 U
200 U
100 F
900 U
-0-
-0-
$ 900 U
As a result of this budget report, Kajsa was called into the president's office and congratulated on her fine sales
performance. She was reprimanded, however, for allowing her costs to get out of control. Kajsa knew something was wrong
with the performance report that she had been given. However, she was not sure what to do and has come to you for
advice.
Instructions
a. Prepare a budget report based on flexible budget data to help Kajsa.
b. Should Kaisa have been reprimanded? Explain
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