Sheridan Sports sells volleyball kits that it purchases from a sports equipment distributor. The following static budget based on sales of2,500 kits was prepared for the year. Fixed operating expenses account for 74% of total operating expenses at this level of sales.Sales$ 500,000Cost of goods sold (all variable)105,600Gross margin394,400Operating expenses32,200Operating income$ 362,200Assume that during the year Sheridan Sports actually sold 2,700 volleyball kits during the year at a price of $ 202 per kit.Calculate the sales price variance. (If variance is zero, select "Not Applicable" and enter 0 for the amounts.)2FavorableSales price variance%24

Formula: Sales price variance = ( Actual Sales price - Standard sales price ) x Actual quantity…

Answered: Sheridan Sports sells volleyball kits…

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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Felsen Industries manufactures basketballs. The budgeted income statement for the year, before any special orders, is as follows: Per Unit $10.00 Amount $4,000,000 3,200,000 800,000 300,000 $500,000 Sales Cost of goods sold Gross Profit Selling expenses Operating income 8.00 2.00 .75 $1.25 Fixed costs included in the above data are $1,200,000 in cost of goods sold and $100,000 in selling expenses. A special order offering to buy 50,000 basketballs for $7.50 each was made to Felsen. There will be no additional selling expenses if the order is accepted. Assuming Felsen has enough capacity to manufacture 50,000 more basketballs, or decreased as a result of accepting the special order? $ decrease] (circle one) what amount would operating income be increased [increase,
The following data relate to a year's budgeted activity for Coronado Limited, a company that manufactures one product: Beginning inventory Production Available for sale Sales Ending inventory Units 40,480 (a) 141,680 Selling price Variable manufacturing costs Variable selling, general, and administrative expenses Fixed manufacturing costs (based on 100,000 units) Fixed selling, general, and administrative expenses (based on 100,000 units) 182,160 131,560 50,600 Break-even sales Per unit $9.00 units 2.00 3.00 Total fixed costs and expenses remain unchanged within the relevant range of 25,000 units to a total capacity of 160,000 units. 0.50 0.80 Calculate the projected annual break-even sales in units. (Round answer to O decimal places, e.g. 5,275.)
Mandy Corporation sells a single product. Budgeted sales for the year are anticipated to be 627,000 units, estimated beginning inventory is 108,000 units, and desired ending inventory is 80,000 units. The quantities of direct materials expected to be used for each unit of finished product are given below.Material A 0.50 lb. per unit @ $0.69 per poundMaterial B 1.00 lb. per unit @ $1.56 per poundMaterial C 1.20 lb. per unit @ $0.97 per poundThe dollar amount of Material B used in production during the year is a.$747,552 b.$934,440 c.$1,401,660 d.$1,121,328
Coronado Sports sells volleyball kits that it purchases from a sports equipment distributor. The following static budget based on sales of 2,500 kits was prepared for the year. Fixed operating expenses account for 75% of total operating expenses at this level of sales. Sales Revenue $ 270,000 Cost of goods sold (all variable) 175,000 Gross margin 95,000 Operating expenses 50,000 Operating income $ 45,000 Prepare a flexible budget based on sales of 1,000, 2,500, and 3,980 units. (Round unit values to 2 decimal places e.g. 15.25 and all other answers to 0 decimal places, e.g. 1525. If operating income is negative, enter amounts using a negative sign preceding the number e.g. -45 or parentheses e.g. (45).) Unit 1,000 2,500 3,980 select an opening item $enter a dollar amount $enter a dollar amount $enter a dollar amount $enter a dollar amount select between…
Tempo Company's fixed budget (based on sales of 16,000 units) follows. Sales (16,000 units Costs Direct materials Direct labor Indirect materials Supervisor salary Fixed Budget $216 per unit) 3,456,000 368,000 704,000 432,000 168,000 Sales commissions 112,000 Shipping 240,000 Administrative salaries 218,000 Depreciation-Office equipment 188,000 Insurance 158,000 Office rent 168,000 700,000 Income 1. Compute total variable cost per unit. 2. Compute total fixed costs. 3. Prepare a flexible budget at activity levels of 14,000 units and 18,000 units. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Required 3 Prepare a flexible budget at activity levels of 14,000 units and 18,000 units. TEMPO COMPANY Flexible Budget Variable Amount per Unit Total Fixed Cost Flexible Budget for: Units Sales Unit Sales of 14,000 of 18,000 Sales Variable costs Direct materials Direct labor Indirect materials Sales commissions Shipping Fixed costs 0.00 이 0 $ 0 S 0 S 0
VideoSecu produces wall mounts for flat panel television sets. Assume the forecasted income state M16-16. Special Order ment for next year is as follows. VIDEOSECU Budgeted Income Statement For the Year $5,600,000 Sales ($28 per unit) . . Cost of good sold ($19 per unit) . (3,800,000) 1,800,000 Gross profit..... Selling expenses ($5 per unit) (1,000,000) $ 800,000 Net income. ADDITIONAL INFORMATION (1) Of the production costs and selling expenses, $1,520,000 and $750,000, respectively, are fixed. (2) VideoSecu received a special order from a hospital supply company offering to buy 10,00 wall mounts for $15. If it accepts the order, there will be no additional fixed selling expenses, and there is currently sufficient excess capacity to fill the order. The company's sales manager argues for rejecting the order because "we are not in the business of paying $19 to make a product to sell for $15." REQUIRED Do you think the company should accept the special order? Should the decision be…
Gardner Corporation manufactures skateboards and is in the process of preparing next year's budget. The pro forma income statement for the current year is presented below. Sales $ 1,500,000 Cost of sales: Direct Material $ 250,000 Direct labor 150,000 Variable Overhead 75,000 Fixed Overhead 100,000 575,000 Gross Profit $ 925,000 Selling and G&A Variable 200,000 Fixed 250,000 450,000 Operating Income $ 475,000 The break-even point (rounded to the nearest dollar) for Gardner Corporation for the current year is:
Coronado Sports sells volleyball kits that it purchases from a sports equipment distributor. The following static budget based on sales of 2,500 kits was prepared for the year. Fixed operating expenses account for 65% of total operating expenses at this level of sales. Sales $ 275,000 Cost of goods sold (all variable) 268,800 Gross margin 6,200 Operating expenses 28,350 Operating income $ - 22,150 Assume that during the year Coronado Sports actually sold 2,700 volleyball kits during the year at a price of $ 113 per kit. Calculate the sales price variance. (If variance is zero, select "Not Applicable" and enter O for the amounts.) $ Sales price variance %24
Blaster Corp. manufactures hiking boots. For the coming year the company has budgeted the following costs for production and sale of 30,000 pairs of boots. Budgeted costs Budgeted costs/pair % of costs considered variable Direct materials $630,000 $21 100% Direct labor 300,000 10 100 manufacturing overhead 720,000 24 25 selling and admin expenses 600,000 20 20 totals $2,250,000 $75 A. Compute the sales price per unit that would result in budgeted operating income of $900,000, assuming that the company produces and sells 30,000 pairs(compute the budgeted sales revenue needed to produce this operating income) Assume the company decides to sell the boots at a unit price of $121/pair B. Compute the following: Total fixed costs budgeted for the year, variable cost per unit, contribution margin per pair of boots and number of pairs that must be produced and sold annually to break even at a sales price of $121 per pair
Sunland Sports sells volleyball kits that it purchases from a sports equipment distributor. The following static budget based on sales of 2,500 kits was prepared for the year. Fixed operating expenses account for 75% of total operating expenses at this level of sales. Sales Revenue $ 230,000 Cost of goods sold (all variable) 170,000 Gross margin 60,000 Operating expenses 50,000 Operating income 2$ 10,000 Prepare a flexible budget based on sales of 1,000, 2,820, and 3,760 units. (Round unit values to 2 decimal places e.g. 15.25 and all other answers to 0 decimal places, eg. 1525. If operating income is negative, enter amounts using a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
Delivery and commission expenses vary proportionally with budgeted sales in dollars. Advertising and office expenses are fixed. Miscellaneous expenses include $5,000 of fixed costs. The rest varies with budgeted sales in dollars. The Year 2 budgeted sales is $5,000,000. Budgeted sales Selling costs: Delivery expenses Commission expenses $1,250,000 $25,000 $30,000 Advertising expenses Office expenses Miscellaneous expenses $10,000 $6,000 $15,000 Total $121,000 What will be the value for commission expenses in the Year 2 selling & administrative expense budget? a. $ 24,000 O b. $120,000 O c. $122,000 d. $102,000
Bailee Company combines its operating expenses for budget purposes in a selling and administrative expense budget. For the first 6 months of 2017, the following data are available. 1. Sales: 33,000 units quarter 1; 35,000 units quarter 2. 2. Variable costs per dollar of sales: Sales commissions $33,000 quarter 1; $35,000 quarter 2, delivery expense $13,200 quarter 1 and $14,000 quarter 2, and advertising $19,800 quarter 1 and $21,000. 3. Fixed costs per quarter: Sales salaries $15,000, office salaries $6,000, depreciation $4,200, insurance $1,500, utilities $800, and repairs expense $600. 4. Unit selling price: $20. Instructions: Prepare a selling and administrative expense budget by quarters for the first 6 months of 201

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