Required: Prepare a sales activity variance analysis for Nottingham Forest Products. Note: Do not round intermediate calculations. Indicate the effect of each variance by selectin or "U" for unfavorable. If there is no effect, do not select either option.

Required: Prepare a sales activity variance analysis for Nottingham Forest Products. Note: Do not round intermediate calculations. Indicate the effect of each variance by selectin or "U" for unfavorable. If there is no effect, do not select either option.

Managerial Accounting: The Cornerstone of Business Decision-Making

7th Edition

ISBN:9781337115773

Author:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Publisher:Maryanne M. Mowen, Don R. Hansen, Dan L. Heitger

Chapter3: Cost Behavior And Cost Forecasting

Section: Chapter Questions

Problem 18BEA: Using High-Low to Calculate Predicted Total Variable Cost and Total Cost for Budgeted Output Refer...

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Question

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Nottingham Forest Products reports the following information concerning operations for the most recent month:
Master Budget
(based on
Sales revenue
Less
Manufacturing costs
Direct labor
Materials
Variable overhead
Marketing
Administrative
Total variable costs
Contribution margin
Fixed costs
Manufacturing
Marketing
Administrative
Total fixed costs
Operating profits
There are no inventories.
Actual (based
on actual sales budgeted sales
of 5,370 units)
of 4,475
units)
$ 210,325
$ 257,200
50,492
31,710
16,798
7,995
7,405
$ 114,400
$ 142,800
39,215
15,050
9,795
$ 64,060
$ 78,740
39,190
27,390
13, 290
6,390
6,690
$ 92,950
$ 117,375
37,590
12,390
10,590
$ 60,570
$ 56,805
Required:
Prepare a sales activity variance analysis for Nottingham Forest Products.
Note: Do not round intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable,
or "U" for unfavorable. If there is no effect, do not select either option.

Sales revenue
Variable costs:
Manufacturing costs:
Direct labor
Materials
Variable overhead
Marketing
Administrative
Total variable costs
Contribution margin
Fixed costs:
Manufacturing
Marketing
Administrative
Total fixed costs
Operating profits
NOTTINGHAM FOREST PRODUCTS
Sales Activity Variance
Flexible Budget
(based on
actual of 5,370
units)
$
$
$
$
0
0
0
0
Master Budget
(based on
Sales Activity Variance budgeted 4,475
units)
$
$
$
$
$
210,325
39,190
27,390
13,290
6,390
6,690
92,950
117,375
37,590
12,390
10,590
60,570
56,805

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