Prepare a new contribution report for the month of April based on a flexible budget.

Question

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Answer 1

Question

Definition Definition Measure used to estimate the difference between the budgeted and annual proportion for a specific accounting year. A favorable budget variance refers to positive variances or gains, while unfavorable or negative variances refer to a shortfall in the budget. A budget variance is indicative of the instances where the actual costs incurred are higher or lower than the estimated costs.

Chapter 11, Problem 55C

1.

To determine

Prepare a new contribution report for the month of April based on a flexible budget.

2.

To determine

State the total contribution margin in the flexible budget column of the new report prepared under requirement (1).

3.

To determine

Describe the meaning of the total contribution margin in the flexible budget column of the new report prepared for the month of April.

4.

To determine

Ascertain the total variance between the flexible budget contribution margin and the actual contribution margin of the new report prepared from requirement (1) and calculate the following variances in order to explain this total contribution margin variance.

a. Direct-material price variance.

b. Direct-material quantity variance.

c. Direct-labor rate variance.

d. Direct-labor efficiency variance.

e. Variable-overhead spending variance.

f. Variable-overhead efficiency variance.

g. Sales-price variance.

5. a

To determine

Describe the problems that the company might face when using direct-labor hours as the basis for applying Overhead.

5. b

To determine

Describe the manner in which the activity-based costing (ABC) would solve the problems described in requirement (5a).

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Answer 2

Question

Definition Definition Measure used to estimate the difference between the budgeted and annual proportion for a specific accounting year. A favorable budget variance refers to positive variances or gains, while unfavorable or negative variances refer to a shortfall in the budget. A budget variance is indicative of the instances where the actual costs incurred are higher or lower than the estimated costs.

Chapter 11, Problem 55C

1.

To determine

Prepare a new contribution report for the month of April based on a flexible budget.

2.

To determine

State the total contribution margin in the flexible budget column of the new report prepared under requirement (1).

3.

To determine

Describe the meaning of the total contribution margin in the flexible budget column of the new report prepared for the month of April.

4.

To determine

Ascertain the total variance between the flexible budget contribution margin and the actual contribution margin of the new report prepared from requirement (1) and calculate the following variances in order to explain this total contribution margin variance.

a. Direct-material price variance.

b. Direct-material quantity variance.

c. Direct-labor rate variance.

d. Direct-labor efficiency variance.

e. Variable-overhead spending variance.

f. Variable-overhead efficiency variance.

g. Sales-price variance.

5. a

To determine

Describe the problems that the company might face when using direct-labor hours as the basis for applying Overhead.

5. b

To determine

Describe the manner in which the activity-based costing (ABC) would solve the problems described in requirement (5a).

Expert Solution & Answer

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Answer 3

Question

Definition Definition Measure used to estimate the difference between the budgeted and annual proportion for a specific accounting year. A favorable budget variance refers to positive variances or gains, while unfavorable or negative variances refer to a shortfall in the budget. A budget variance is indicative of the instances where the actual costs incurred are higher or lower than the estimated costs.

Chapter 11, Problem 55C

1.

To determine

Prepare a new contribution report for the month of April based on a flexible budget.

2.

To determine

State the total contribution margin in the flexible budget column of the new report prepared under requirement (1).

3.

To determine

Describe the meaning of the total contribution margin in the flexible budget column of the new report prepared for the month of April.

4.

To determine

Ascertain the total variance between the flexible budget contribution margin and the actual contribution margin of the new report prepared from requirement (1) and calculate the following variances in order to explain this total contribution margin variance.

a. Direct-material price variance.

b. Direct-material quantity variance.

c. Direct-labor rate variance.

d. Direct-labor efficiency variance.

e. Variable-overhead spending variance.

f. Variable-overhead efficiency variance.

g. Sales-price variance.

5. a

To determine

Describe the problems that the company might face when using direct-labor hours as the basis for applying Overhead.

5. b

To determine

Describe the manner in which the activity-based costing (ABC) would solve the problems described in requirement (5a).

Expert Solution & Answer

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Answer 4

Question

Definition Definition Measure used to estimate the difference between the budgeted and annual proportion for a specific accounting year. A favorable budget variance refers to positive variances or gains, while unfavorable or negative variances refer to a shortfall in the budget. A budget variance is indicative of the instances where the actual costs incurred are higher or lower than the estimated costs.

Chapter 11, Problem 55C

1.

To determine

Prepare a new contribution report for the month of April based on a flexible budget.

2.

To determine

State the total contribution margin in the flexible budget column of the new report prepared under requirement (1).

3.

To determine

Describe the meaning of the total contribution margin in the flexible budget column of the new report prepared for the month of April.

4.

To determine

Ascertain the total variance between the flexible budget contribution margin and the actual contribution margin of the new report prepared from requirement (1) and calculate the following variances in order to explain this total contribution margin variance.

a. Direct-material price variance.

b. Direct-material quantity variance.

c. Direct-labor rate variance.

d. Direct-labor efficiency variance.

e. Variable-overhead spending variance.

f. Variable-overhead efficiency variance.

g. Sales-price variance.

5. a

To determine

Describe the problems that the company might face when using direct-labor hours as the basis for applying Overhead.

5. b

To determine

Describe the manner in which the activity-based costing (ABC) would solve the problems described in requirement (5a).

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Answer 5

Chapter 11, Problem 55C

1.

To determine

Prepare a new contribution report for the month of April based on a flexible budget.

2.

To determine

State the total contribution margin in the flexible budget column of the new report prepared under requirement (1).

3.

To determine

Describe the meaning of the total contribution margin in the flexible budget column of the new report prepared for the month of April.

4.

To determine

Ascertain the total variance between the flexible budget contribution margin and the actual contribution margin of the new report prepared from requirement (1) and calculate the following variances in order to explain this total contribution margin variance.

a. Direct-material price variance.

b. Direct-material quantity variance.

c. Direct-labor rate variance.

d. Direct-labor efficiency variance.

e. Variable-overhead spending variance.

f. Variable-overhead efficiency variance.

g. Sales-price variance.

5. a

To determine

Describe the problems that the company might face when using direct-labor hours as the basis for applying Overhead.

5. b

To determine

Describe the manner in which the activity-based costing (ABC) would solve the problems described in requirement (5a).

Answer 6

Chapter 11, Problem 55C

1.

To determine

Prepare a new contribution report for the month of April based on a flexible budget.

Answer 7

Chapter 11, Problem 55C

1.

To determine

Prepare a new contribution report for the month of April based on a flexible budget.

Answer 8

2.

To determine

State the total contribution margin in the flexible budget column of the new report prepared under requirement (1).

Answer 9

2.

To determine

State the total contribution margin in the flexible budget column of the new report prepared under requirement (1).

Answer 10

3.

To determine

Describe the meaning of the total contribution margin in the flexible budget column of the new report prepared for the month of April.

Answer 11

3.

To determine

Describe the meaning of the total contribution margin in the flexible budget column of the new report prepared for the month of April.

Answer 12

4.

To determine

Ascertain the total variance between the flexible budget contribution margin and the actual contribution margin of the new report prepared from requirement (1) and calculate the following variances in order to explain this total contribution margin variance.

a. Direct-material price variance.

b. Direct-material quantity variance.

c. Direct-labor rate variance.

d. Direct-labor efficiency variance.

e. Variable-overhead spending variance.

f. Variable-overhead efficiency variance.

g. Sales-price variance.

Answer 13

4.

To determine

Ascertain the total variance between the flexible budget contribution margin and the actual contribution margin of the new report prepared from requirement (1) and calculate the following variances in order to explain this total contribution margin variance.

a. Direct-material price variance.

b. Direct-material quantity variance.

c. Direct-labor rate variance.

d. Direct-labor efficiency variance.

e. Variable-overhead spending variance.

f. Variable-overhead efficiency variance.

g. Sales-price variance.

Answer 14

5. a

To determine

Describe the problems that the company might face when using direct-labor hours as the basis for applying Overhead.

Answer 15

5. a

To determine

Describe the problems that the company might face when using direct-labor hours as the basis for applying Overhead.

Answer 16

5. b

To determine

Describe the manner in which the activity-based costing (ABC) would solve the problems described in requirement (5a).

Answer 17

5. b

To determine

Describe the manner in which the activity-based costing (ABC) would solve the problems described in requirement (5a).

Answer 18

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Answer 19

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Answer 20

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Answer 21

Ch. 11 - Distinguish between static and flexible budgets.Ch. 11 - Explain the advantage of using a flexible budget.Ch. 11 - Why are flexible overhead budgets based on...Ch. 11 - Distinguish between a columnar and a formula...Ch. 11 - Show, using T-accounts, how production overhead is...Ch. 11 - How have advances in manufacturing technology...Ch. 11 - What is the interpretation of the...Ch. 11 - Jeffries Companys only variable-overhead cost is...Ch. 11 - What is the interpretation of the...Ch. 11 - Distinguish between the interpretations of the...

Prepare a new contribution report for the month of April based on a flexible budget.

Prepare a new contribution report for the month of April based on a flexible budget.

State the total contribution margin in the flexible budget column of the new report prepared under requirement (1).

Describe the meaning of the total contribution margin in the flexible budget column of the new report prepared for the month of April.

Describe the problems that the company might face when using direct-labor hours as the basis for applying Overhead.

Describe the manner in which the activity-based costing (ABC) would solve the problems described in requirement (5a).

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