Trevorrow Corporation manufactures and sells a single product. the company uses units as the measure of activity in its budgets and performance reports. During June, the company budgeted for 5,800 units, but its actual level of activity was 5,760 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for June: Data used in budgeting: Revenue: $29.20 Variable element per unit Direct Labor $3.80 Variable element per unit Direct Materials: $9.90 Variable element per unit Manufacturing Overhead: $38,900 fixed element per month, $1.50 variable element per unit Selling and Administrative expenses: $24,500, $0.30 Variable element per unit Total Expenses: $63,400 fixed element per month, $15.50 variable element per unit Actual results for June: Revenue: $170.258 Direct Labor: $21,347 Direct Materials: $54,759 Manufacturing overhead: $47,430 Selling and Administrative Expenses: $26,268 The overall revenue and spending variance (i.e., the variance for net operating income in the revenue and spending variance column on the flexible budget performance report) for June would be closest to:?
Trevorrow Corporation manufactures and sells a single product. the company uses units as the measure of activity in its budgets and performance reports. During June, the company budgeted for 5,800 units, but its actual level of activity was 5,760 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for June: Data used in budgeting: Revenue: $29.20 Variable element per unit Direct Labor $3.80 Variable element per unit Direct Materials: $9.90 Variable element per unit Manufacturing Overhead: $38,900 fixed element per month, $1.50 variable element per unit Selling and Administrative expenses: $24,500, $0.30 Variable element per unit Total Expenses: $63,400 fixed element per month, $15.50 variable element per unit Actual results for June: Revenue: $170.258 Direct Labor: $21,347 Direct Materials: $54,759 Manufacturing overhead: $47,430 Selling and Administrative Expenses: $26,268 The overall revenue and spending variance (i.e., the variance for net operating income in the revenue and spending variance column on the flexible budget performance report) for June would be closest to:?
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
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Transcribed Image Text:Trevorrow Corporation manufactures and sells a single product. the company uses units as the measure of activity in its budgets and
performance reports. During June, the company budgeted for 5,800 units, but its actual level of activity was 5,760 units. The company
has provided the following data concerning the formulas used in its budgeting and its actual results for June:
Data used in budgeting:
Revenue: $29.20 Variable element per unit
Direct Labor $3.80 Variable element per unit
Direct Materials: $9.90 Variable element per unit
Manufacturing Overhead: $38,900 fixed element per month, $1.50 variable element per unit
Selling and Administrative expenses: $24,500, $0.30 Variable element per unit
Total Expenses: $63,400 fixed element per month, $15.50 variable element per unit
Actual results for June:
Revenue: $170.258
Direct Labor: $21,347
Direct Materials: $54,759
Manufacturing overhead: $47,430
Selling and Administrative Expenses: $26,268
The overall revenue and spending variance (i.e., the variance for net operating income in the revenue and spending variance column on
flexible budget performance report) June would be closest to: ?
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