Fixed Budget Performance Report: Fixed Budget Performance Report is reporting that compares the actual results with fixed budget figures. This report calculates the differences between the figures of the actual and fixed budget. To determine: The limit on the use of Fixed Budget Performance Report for managers

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Answer 1

Question

Chapter 23, Problem 1DQ

To determine

Introduction:

Fixed Budget Performance Report: Fixed Budget Performance Report is reporting that compares the actual results with fixed budget figures. This report calculates the differences between the figures of the actual and fixed budget.

To determine: The limit on the use of Fixed Budget Performance Report for managers

Expert Solution & Answer

Answer to Problem 1DQ

Solution: A fixed Budget Performance Report shows the variances between actual and budgeted figures but it does not show the flexible budget variances.

Explanation of Solution

Explanation: A fixed budget is prepared at an expected level of activity, but the actual level of activity may differ. A Fixed Budget Performance Report compares the actual results with fixed budget figures, that may be useful for managers to see the total variance, but it does not bifurcate the variance in Activity and flexible budget variance. To evaluate the actual variances flexible budget variance analysis is necessary for the management, which is not provided by the Fixed Budget Performance Report.

Conclusion

Conclusion: Hence, it can be concluded that a fixed Budget Performance Report shows the variances between actual and budgeted figures.

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JH, Inc., is a calendar year, accrual basis corporation with Joe as its sole shareholder (basis in his stock is $90,000). On January 1 of the current year, JH Corporation has accumulated E & P of $200,000. Before considering the effect of the distribution described below, the corporation’s current E & P is $50,000. On November 1, JH distributes an office building to Joe. The office building has an adjusted basis of $80,000 (fair market value of $100,000) and is subject to a mortgage of $110,000. Assume that the building has been depreciated using the ADS method for both income tax and E & P purposes. What are the tax consequences of the distribution to JH and to Joe? (In your answer, be sure to describe the effects on taxable income for both JH and Joe, the impact of the distribution on JH’s E & P, and Joe’s basis in the building.)

Joe is the sole shareholder of JH Corporation. Joe sold his stock to Ethan on October 31 for $150,000. Joe’s basis in JH stock was $50,000 at the start of the year. JH distributed land to Joe immediately before the sale. JH’s basis in the land was $20,000 (fair market value of $25,000). On December 31, Ethan received a $75,000 cash distribution from JH. During the year, JH has $20,000 of current E & P and its accumulated E & P balance on January 1 is $10,000. Which of the following statements is true? a. Joe recognizes a $110,000 gain on the sale of his stock. b. Joe recognizes a $100,000 gain on the sale of his stock. c. Ethan receives $5,000 of dividend income.d. Joe receives $20,000 of dividend income. e. None of the above.

Answer 2

Question

Chapter 23, Problem 1DQ

To determine

Introduction:

Fixed Budget Performance Report: Fixed Budget Performance Report is reporting that compares the actual results with fixed budget figures. This report calculates the differences between the figures of the actual and fixed budget.

To determine: The limit on the use of Fixed Budget Performance Report for managers

Expert Solution & Answer

Answer to Problem 1DQ

Solution: A fixed Budget Performance Report shows the variances between actual and budgeted figures but it does not show the flexible budget variances.

Explanation of Solution

Explanation: A fixed budget is prepared at an expected level of activity, but the actual level of activity may differ. A Fixed Budget Performance Report compares the actual results with fixed budget figures, that may be useful for managers to see the total variance, but it does not bifurcate the variance in Activity and flexible budget variance. To evaluate the actual variances flexible budget variance analysis is necessary for the management, which is not provided by the Fixed Budget Performance Report.

Conclusion

Conclusion: Hence, it can be concluded that a fixed Budget Performance Report shows the variances between actual and budgeted figures.

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Answer 3

Question

Chapter 23, Problem 1DQ

To determine

Introduction:

Fixed Budget Performance Report: Fixed Budget Performance Report is reporting that compares the actual results with fixed budget figures. This report calculates the differences between the figures of the actual and fixed budget.

To determine: The limit on the use of Fixed Budget Performance Report for managers

Expert Solution & Answer

Answer to Problem 1DQ

Solution: A fixed Budget Performance Report shows the variances between actual and budgeted figures but it does not show the flexible budget variances.

Explanation of Solution

Explanation: A fixed budget is prepared at an expected level of activity, but the actual level of activity may differ. A Fixed Budget Performance Report compares the actual results with fixed budget figures, that may be useful for managers to see the total variance, but it does not bifurcate the variance in Activity and flexible budget variance. To evaluate the actual variances flexible budget variance analysis is necessary for the management, which is not provided by the Fixed Budget Performance Report.

Conclusion

Conclusion: Hence, it can be concluded that a fixed Budget Performance Report shows the variances between actual and budgeted figures.

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Answer 4

Question

Chapter 23, Problem 1DQ

To determine

Introduction:

Fixed Budget Performance Report: Fixed Budget Performance Report is reporting that compares the actual results with fixed budget figures. This report calculates the differences between the figures of the actual and fixed budget.

To determine: The limit on the use of Fixed Budget Performance Report for managers

Expert Solution & Answer

Answer to Problem 1DQ

Solution: A fixed Budget Performance Report shows the variances between actual and budgeted figures but it does not show the flexible budget variances.

Explanation of Solution

Explanation: A fixed budget is prepared at an expected level of activity, but the actual level of activity may differ. A Fixed Budget Performance Report compares the actual results with fixed budget figures, that may be useful for managers to see the total variance, but it does not bifurcate the variance in Activity and flexible budget variance. To evaluate the actual variances flexible budget variance analysis is necessary for the management, which is not provided by the Fixed Budget Performance Report.

Conclusion

Conclusion: Hence, it can be concluded that a fixed Budget Performance Report shows the variances between actual and budgeted figures.

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Answer 5

Chapter 23, Problem 1DQ

To determine

Introduction:

Fixed Budget Performance Report: Fixed Budget Performance Report is reporting that compares the actual results with fixed budget figures. This report calculates the differences between the figures of the actual and fixed budget.

To determine: The limit on the use of Fixed Budget Performance Report for managers

Expert Solution & Answer

Answer to Problem 1DQ

Solution: A fixed Budget Performance Report shows the variances between actual and budgeted figures but it does not show the flexible budget variances.

Explanation of Solution

Explanation: A fixed budget is prepared at an expected level of activity, but the actual level of activity may differ. A Fixed Budget Performance Report compares the actual results with fixed budget figures, that may be useful for managers to see the total variance, but it does not bifurcate the variance in Activity and flexible budget variance. To evaluate the actual variances flexible budget variance analysis is necessary for the management, which is not provided by the Fixed Budget Performance Report.

Conclusion

Conclusion: Hence, it can be concluded that a fixed Budget Performance Report shows the variances between actual and budgeted figures.

Answer 6

Chapter 23, Problem 1DQ

To determine

Introduction:

Fixed Budget Performance Report: Fixed Budget Performance Report is reporting that compares the actual results with fixed budget figures. This report calculates the differences between the figures of the actual and fixed budget.

To determine: The limit on the use of Fixed Budget Performance Report for managers

Expert Solution & Answer

Answer to Problem 1DQ

Solution: A fixed Budget Performance Report shows the variances between actual and budgeted figures but it does not show the flexible budget variances.

Explanation of Solution

Explanation: A fixed budget is prepared at an expected level of activity, but the actual level of activity may differ. A Fixed Budget Performance Report compares the actual results with fixed budget figures, that may be useful for managers to see the total variance, but it does not bifurcate the variance in Activity and flexible budget variance. To evaluate the actual variances flexible budget variance analysis is necessary for the management, which is not provided by the Fixed Budget Performance Report.

Conclusion

Conclusion: Hence, it can be concluded that a fixed Budget Performance Report shows the variances between actual and budgeted figures.

Answer 7

Chapter 23, Problem 1DQ

To determine

Introduction:

Fixed Budget Performance Report: Fixed Budget Performance Report is reporting that compares the actual results with fixed budget figures. This report calculates the differences between the figures of the actual and fixed budget.

To determine: The limit on the use of Fixed Budget Performance Report for managers

Answer 8

Expert Solution & Answer

Answer to Problem 1DQ

Solution: A fixed Budget Performance Report shows the variances between actual and budgeted figures but it does not show the flexible budget variances.

Answer 9

Expert Solution & Answer

Answer 10

Expert Solution & Answer

Answer 11

Explanation of Solution

Explanation: A fixed budget is prepared at an expected level of activity, but the actual level of activity may differ. A Fixed Budget Performance Report compares the actual results with fixed budget figures, that may be useful for managers to see the total variance, but it does not bifurcate the variance in Activity and flexible budget variance. To evaluate the actual variances flexible budget variance analysis is necessary for the management, which is not provided by the Fixed Budget Performance Report.

Answer 12

Conclusion

Conclusion: Hence, it can be concluded that a fixed Budget Performance Report shows the variances between actual and budgeted figures.

Answer 13

Ch. 23 - Prob. 1DQ Ch. 23 - Prob. 2DQ Ch. 23 - Prob. 3DQ Ch. 23 - Prob. 4DQ Ch. 23 - Prob. 5DQ Ch. 23 - Prob. 6DQ Ch. 23 - Prob. 7DQ Ch. 23 - Prob. 8DQ Ch. 23 - Prob. 9DQ Ch. 23 - Prob. 10DQ

Answer to Problem 1DQ

Explanation of Solution

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Chapter 23 Solutions