Required 1. Prepare a Level 1 analysis of the September performance. 2. Prepare a Level 2 analysis of the September performance. 3. Why might Trustex find the Level 2 analysis more informative than the Level 1 analysis? Explain your answer.
Required 1. Prepare a Level 1 analysis of the September performance. 2. Prepare a Level 2 analysis of the September performance. 3. Why might Trustex find the Level 2 analysis more informative than the Level 1 analysis? Explain your answer.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Alert for not submit AI generated answer. I need unique and correct answer. Don't try to copy from anywhere. Do not give answer in image formet and hand writing
![7-21 Flexible-budget preparation and analysis. [Excel template] (LO 2) Trustex
Printers Inc. produces luxury chequebooks with three cheques and stubs per page.
Each chequebook is designed for an individual customer and is ordered through
the customer's bank. The company's operating budget for September included
these data:
Number of chequebooks
Selling price per book
Variable costs per book
Total fixed costs for the month
The actual results for September were
Number of chequebooks produced and sold
Average selling price per book
Variable costs per book
Total fixed costs for the month
15,000
$ 20
S
8
$145,000
10,000
S
25.20
S
7
$150,000
The executive vice-president of the company observed that the operating income
for September was much less than anticipated, despite a higher-than-budgeted
selling price and a lower-than-budgeted variable cost per unit. You have been
asked to provide explanations for the disappointing September results.
Trustex develops its flexible-budget-based budgeted revenue per output unit and
variable costs per output unit without a detailed analysis of budgeted inputs.
Required
1. Prepare a Level 1 analysis of the September performance.
2. Prepare a Level 2 analysis of the September performance.
3. Why might Trustex find the Level 2 analysis more informative than the
Level 1 analysis? Explain your answer.
Check Figure: 2. Total flexible-budget variance, $57,000 F](/v2/_next/image?url=https%3A%2F%2Fcontent.bartleby.com%2Fqna-images%2Fquestion%2Fc8cc6a94-36f8-4576-8320-db971d5087fb%2F7507c822-cfe4-4a09-b5a6-0a5160bd9db3%2F00ptxhv_processed.jpeg&w=3840&q=75)
Transcribed Image Text:7-21 Flexible-budget preparation and analysis. [Excel template] (LO 2) Trustex
Printers Inc. produces luxury chequebooks with three cheques and stubs per page.
Each chequebook is designed for an individual customer and is ordered through
the customer's bank. The company's operating budget for September included
these data:
Number of chequebooks
Selling price per book
Variable costs per book
Total fixed costs for the month
The actual results for September were
Number of chequebooks produced and sold
Average selling price per book
Variable costs per book
Total fixed costs for the month
15,000
$ 20
S
8
$145,000
10,000
S
25.20
S
7
$150,000
The executive vice-president of the company observed that the operating income
for September was much less than anticipated, despite a higher-than-budgeted
selling price and a lower-than-budgeted variable cost per unit. You have been
asked to provide explanations for the disappointing September results.
Trustex develops its flexible-budget-based budgeted revenue per output unit and
variable costs per output unit without a detailed analysis of budgeted inputs.
Required
1. Prepare a Level 1 analysis of the September performance.
2. Prepare a Level 2 analysis of the September performance.
3. Why might Trustex find the Level 2 analysis more informative than the
Level 1 analysis? Explain your answer.
Check Figure: 2. Total flexible-budget variance, $57,000 F
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 3 steps
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education