Financial And Managerial Accounting
15th Edition
ISBN: 9781337902663
Author: WARREN, Carl S.
Publisher: Cengage Learning,
expand_more
expand_more
format_list_bulleted
Concept explainers
Videos
Textbook Question
Chapter 22, Problem 3TIF
Communication
The city of Milton has an annual budget cycle that begins on July 1 and ends on June 30. At the beginning of each budget year, an annual budget is established for each department. The annual budget is divided equally among the 12 months to provide a constant monthly static budget. On June 30, all unspent budgeted monies for the budget year from the various city departments must be “returned” to the General Fund. Thus, if department heads fail to use their budget by year-end, they will lose it. A budget analyst prepared a chart of the difference between the monthly actual and budgeted amounts for all departments in a recent fiscal year. The chart was as follows:
Write a memo to Stacy Poindexter, the city manager, interpreting the chart and suggesting improvements to the budgeting system.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
The City of Bedford Falls debt service fund budgeted $150,000 (2 payments of $75,000) for interest and an annual principal payment of $500,000. Funding will be transferred from the general fund at the time payments are to be made. Interest payments will be December 15 and June 15. Principal will be paid on June 15. Journalize the budget for July 1 Journal any necessary December 15 entry(ies) What is the amount of accrued interest to be recorded in the Debt Service Fund at June 30?
"The City of Lakeview adopts its budget on a basis of accounting that permits outstanding purchase
commitments to be charged against the budget in the year that the goods are ordered instead of in the year
they are received. During the year the city ordered and received $4,000 of supplies (of which $3,000 had been
paid and $1,000 was unpaid) and had $500 of outstanding purchase commitments for supplies at year-end. In
the budget-to-actual comparison, the expenditures for supplies would be:
""$3,000"
"$3,500"
"$4,000 "
"$4,500"
The finance director of the Bethandy Independent School District is making preliminary estimates of the budget outlook for the General Fund for the 20x8 fiscal year. These estimates will permit the superintendent to advise the department heads properly when budget instructions and forms are distributed. She has assembled the following information:
Estimated 20X7
Expected Change- 20X8
1. Revenues
Property Taxes............................................................................
$2,000,000
+6%
State aid.......................................................................................
1,000,000
+3%
Federal grants..............................................................................
500,000
-$40,000
Other............................................................................................
300,000
+$10,000
$3,800,000
2. Expenditures
Salaries and…
Chapter 22 Solutions
Financial And Managerial Accounting
Ch. 22 - Prob. 1DQCh. 22 - Briefly describe the type of human behavior...Ch. 22 - What behavioral problems are associated with...Ch. 22 - What behavioral problems are associated with...Ch. 22 - Under what circumstances would a static budget be...Ch. 22 - Prob. 6DQCh. 22 - Why should the production requirements set forth...Ch. 22 - Why should the timing of direct materials...Ch. 22 - A. Discuss the purpose of the cash budget. B. If...Ch. 22 - Give an example of how the capital expenditures...
Ch. 22 - At the beginning of the period, the Fabricating...Ch. 22 - Pasadena Candle Inc. projected sales of 800,000...Ch. 22 - Pasadena Candle Inc. budgeted production of...Ch. 22 - Pasadena Candle Inc. budgeted production of...Ch. 22 - Prepare a cost of goods sold budget for Pasadena...Ch. 22 - Prob. 6BECh. 22 - At the beginning of the school year, Craig Kovar...Ch. 22 - Digital Solutions Inc. uses flexible budgets that...Ch. 22 - Static budget versus flexible budget The...Ch. 22 - Flexible budget for Assembly Department Steelcase...Ch. 22 - Production budget Healthy Measures Inc. produces a...Ch. 22 - Sales and production budgets Sonic Inc....Ch. 22 - Professional foes earned budget for a service...Ch. 22 - Professional labor cost budget for a service...Ch. 22 - Direct materials purchases budget Tobins Frozen...Ch. 22 - Direct materials purchases budget Coca-Cola...Ch. 22 - Direct materials purchases budget Anticipated...Ch. 22 - Direct labor cost budget Ace Racket Company...Ch. 22 - Production and direct labor cost budgets Levi...Ch. 22 - Factory overhead cost budget Sweet Tooth Candy...Ch. 22 - Cost of goods sold budget Delaware Chemical...Ch. 22 - Cost of goods sold budget The controller of...Ch. 22 - Schedule of cash collections of accounts...Ch. 22 - Schedule of cash collections of accounts...Ch. 22 - Schedule of cash payments for service company...Ch. 22 - Schedule of cash payments for a service company...Ch. 22 - Capital expenditures budget On January 1, 20Y6,...Ch. 22 - Forecast sales volume and sales budget For 20Y8,...Ch. 22 - Sales, production, direct materials purchases, and...Ch. 22 - Budgeted income statement and supporting budgets...Ch. 22 - Budgeted income statement and supporting budgets...Ch. 22 - Cash budget The controller of Bridgeport...Ch. 22 - Budgeted income statement and balance sheet As a...Ch. 22 - Forecast sales volume and sales budget Sentinel...Ch. 22 - Sales, production, direct materials purchases, and...Ch. 22 - Budgeted income statement and supporting budgets...Ch. 22 - Prob. 4PBCh. 22 - Cash budget The controller of Mercury Shoes Inc....Ch. 22 - Budgeted income statement and balance sheet As a...Ch. 22 - Analyze Johnson Stores staffing budget for...Ch. 22 - Nursing staff budget Mercy Hospital staffs its...Ch. 22 - Parking lot staff budget Adventure Park is a large...Ch. 22 - Housekeeping staff budget Ambassador Suites Inc....Ch. 22 - Ethics in Action The director of marketing for...Ch. 22 - Communication The city of Milton has an annual...Ch. 22 - Prob. 4TIFCh. 22 - Static budget for a service company A hank manager...Ch. 22 - Objectives of the master budget Dominos Pizza LLC...Ch. 22 - When compared to static budgets, flexible budgets:...Ch. 22 - Hannon Retailing Company prices its products by...Ch. 22 - Ming Company has budgeted sales at 6,300 units for...Ch. 22 - Krouse Company produces two products, forged...
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.Similar questions
- 1 The city in which you live provides its budget information in monthly budgetary control reports with each month representing 1/12th of the overall budget. You overhear several managers discussing the budget at a community meeting. You were surprised to hear that half of the managers liked this process and that the other half felt that it did not adequately match their expenses. Discuss the issues regarding the preparation of the budgets and why half of the departments liked the process and why the other half did not like the process. Complete the following: Give examples of 1 department on each side of this controversy. Can the budgeting process be made more reflective of the work actually being completed? Explain your answer.arrow_forwardThe City of South River budget for the fiscal year ended June 30, 2020, included an appropriation for the police department in the amount of $8,900,000. During the month of July 2020, the following transactions occurred (in summary):Purchase orders were issued in the amount of $520,000.Of the $520,000 in purchase orders, $480,000 were filled, with invoices amounting to $478,000.Salaries, not encumbered, amounted to $302,000.A budget appropriations reduction in the amount of $50,000 was approved by the city council.Prepare an appropriations, expenditures, and encumbrances ledger for the police department for the month of July. (Credit amounts should be indicated by a minus sign.)arrow_forwardEvaluating a Company’s Budget Procedures Springfield Corporation operates on a calendar-year basis. It begins the annual budgeting process in late August, when the president establishes targets for total sales dollars and net operating income before taxes for the next year. The sales target is given to the Marketing Department, where the marketing manager formulates a sales budget by product line in both units and dollars. From this budget, sales quotas by product line in units and dollars are established for each of the corporation’s sales districts. The marketing manager also estimates the cost of the marketing activities required to support the target sales volume and prepares a tentative marketing expense budget. The executive vice president uses the sales and profit targets, the sales budget by product line, and the tentative marketing expense budget to determine the dollar amounts that can be devoted to manufacturing and corporate office expense. The executive vice president…arrow_forward
- Fairview Medical Supply has applied for a loan. First American Bank has requested a budgeted balance sheet as of April 30, and a combined cash budget for April. As Fairview Medical Supply's controller, you have assembled the following information: a. March 31 equipment balance, $52,700; accumulated depreciation, $41,100. b. April capital expenditures of $42,700 budgeted for cash purchase of equipment. c. April depreciation expense, $500. d. Cost of goods sold, 60% of sales. e. Other April operating expenses, including income tax, total $13,400, 30%of which will be paid in cash and the remainder accrued at April 30. f. March 31 owners' equity, $93,600. g. March 31 cash balance, $40,100. h. April budgeted sales, $91,000, 70% of which is for cash. Of the remaining 30%, half will be collected in April and half in May. i. April cash collections on March sales, $29,200. j. April cash payments of March 31 liabilities incurred…arrow_forwardanswer in text form please (without image)arrow_forwardThe city council of Temecula approved the 2013 budget as follows: Budgeted 2013 revenues from: Property taxes $6,000,000 Sales taxes $2,000,000 Appropriations for 2013: Salaries $5,600,000 Materials $2,200,000 Equipment $125,000 Required: Prepare the general journal entry necessary to initially record the budget on 1/1/13 Date Account Debit Creditarrow_forward
- TOPIC: BUDGETARY PLANNING/MASTER BUDGETING Palmer Corporation operates on a calendar-year basis. It begins the annual budgeting process in late August when the president establishes targets for the total dollar sales and net income before taxes for the next year. The sales target is given first to the marketing department. The marketing manager formulates a sales budget by product line in both units and dollars. From this budget, sales quotas by product line in units and dollars are established for each of the corporation's sales districts. The marketing manager also estimates the cost of the marketing activities required to support the target sales volume and prepares a tentative marketing expense budget. The executive vice president uses the sales and profit targets, the sales budget by product line, and the tentative marketing expense budget to determine the dollar amounts that can be devoted to manufacturing and corporate office expense. The executive vice president prepares…arrow_forwardAccounting for salaries A federal agency receives a separate allotment to finance the salary costs of its program. The allotment is sufficient to cover salaries earned in the last month of the fiscal year but paid early in the next fiscal year. The account Allotments-realized resources has a credit balance of $300,000. The agency maintains budgetary control by means of a vacancy control system. The following events and transactions occurred at the agency: 1. A disbursement schedule is sent to Treasury requesting salary checks- $275,000. 2. Treasury notifies the agency that payment was made. 3. The agency accrues salaries of $18,000 at the end of the fiscal year. 4. The agency accrues $20,000 for unused vacation leave. Budgetary resources for vacation leave are provided when leave is actually taken. a) Make the budgetary entries needed to record the above transactions. Enter accounts in order of magnitude (largest to smallest amounts), debits first. If no entry is necessary, select 'No…arrow_forwardSubject: acountingarrow_forward
- please answer within the format by providing formula the detailed workingPlease provide answer in text (Without image)Please provide answer in text (Without image)Please provide answer in text (Without image) Calculate the budgeted cash disbursements during the month of February. Calculate the budgeted cash collection during the month of January Calculated budgeted number of units of inventory to be purchased during the month of Marcharrow_forwardPreparation of financial statements and interpretation of operating results Below is the December 31, 2022 trial balance for Radnor City's General Fund. Trial Balance Account Debit Credit Estimated revenues-property taxes $500,000 Estimated revenues-intergovernmental 150,000 Estimated revenues-licenses and fees 100,000 Estimated revenues-fines 50,000 Budgetary fund balance Appropriations-general government 10,000 $159,000 Appropriations-parks and recreation 175,000 Appropriations-public safety 446,000 Appropriations-social services 30,000 Expenditures-public safety 441,000 Expenditures-general government 150,500 Expenditures-parks and recreation 170,500 Expenditures-social services 27,000 Cash 35,600 Property taxes receivable 67,200 Tax anticipation notes payable 10,000 Interest payable 800 Revenues-property taxes 497,000 Revenues-intergovernmental 154,000 Revenues-licenses and fees 99,000 Revenues-fines 48,000 Fund balance 62,000 Vouchers payable 21,000 Total $1,701,800 $1,701,800arrow_forwardHugo Medical Supply has applied for a loan. Pacific Commerce Bank has requested a budgeted balance sheet as of April 30, and a combined cash budget for April. As Hugo Medical Supply's controller, you have assembled the following information: a. March 31 equipment balance, $52,600; accumulated depreciation, $41,300. b. April capital expenditures of $ 42,400 budgeted for cash purchase of equipment. c. April depreciation expense, $700. d. Cost of goods sold, 60%of sales. e. Other April operating expenses, including income tax, total $14,200, 35% of which will be paid in cash and the remainder accrued at April 30. f. March 31 owners' equity, $92,600. g. March 31 cash balance, $40,300. h. April budgeted sales, $90,000, 70% of which is for cash. Of the remaining 30%, half will be collected in April and half in May. i. April cash collections on March sales, $29,100. j. April cash payments of March 31 liabilities incurred for March…arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
Managerial AccountingAccountingISBN:9781337912020Author:Carl Warren, Ph.d. Cma William B. TaylerPublisher:South-Western College PubFinancial And Managerial AccountingAccountingISBN:9781337902663Author:WARREN, Carl S.Publisher:Cengage Learning,
Survey of Accounting (Accounting I)AccountingISBN:9781305961883Author:Carl WarrenPublisher:Cengage Learning
Managerial Accounting
Accounting
ISBN:9781337912020
Author:Carl Warren, Ph.d. Cma William B. Tayler
Publisher:South-Western College Pub
Financial And Managerial Accounting
Accounting
ISBN:9781337902663
Author:WARREN, Carl S.
Publisher:Cengage Learning,
Survey of Accounting (Accounting I)
Accounting
ISBN:9781305961883
Author:Carl Warren
Publisher:Cengage Learning
Responsibility Accounting| Responsibility Centers and Segments| US CMA Part 1| US CMA course; Master Budget and Responsibility Accounting-Intro to Managerial Accounting- Su. 2013-Prof. Gershberg; Author: Mera Skill; Rutgers Accounting Web;https://www.youtube.com/watch?v=SYQ4u1BP24g;License: Standard YouTube License, CC-BY