1. The following summary data are from a performance report for Smudge Company for August, during which 8,300 units were produced. The budget reflects the company's normal capacity of 9,000 units. Actual Costs Budget Variance (8,300 units) (9,000 units) S Direct material (F $105,750 $108,000 $2,250) (F Direct labor $216,475 $220,500 $4,025 Variable (F overhead $83,630 $89,370 $5,740 ) (U Fixed overhead $51,200 $50,000 ($1,200) ) (F Total $457,055 $467,870 $10,815) Revise the performance report using flexible budgeting and comment on the general implications of the revised report.
1. The following summary data are from a performance report for Smudge Company for August, during which 8,300 units were produced. The budget reflects the company's normal capacity of 9,000 units. Actual Costs Budget Variance (8,300 units) (9,000 units) S Direct material (F $105,750 $108,000 $2,250) (F Direct labor $216,475 $220,500 $4,025 Variable (F overhead $83,630 $89,370 $5,740 ) (U Fixed overhead $51,200 $50,000 ($1,200) ) (F Total $457,055 $467,870 $10,815) Revise the performance report using flexible budgeting and comment on the general implications of the revised report.
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
Chapter9: Profit Planning And Flexible Budgets
Section: Chapter Questions
Problem 48BEB: Performance Report Based on Budgeted and Actual Levels of Production Balboa Company budgeted...
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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.
Question
Transcribed Image Text:1. The following summary data are from a performance report for Smudge
Company for August, during which 8,300 units were produced. The budget
reflects the company's normal capacity of 9,000 units.
Actual
Costs
Budget
Variance
(8,300 units)
(9,000 units)
S
(F
Direct material
$105,750
$108,000
$2,250)
(F
Direct labor
$216,475
$220,500
$4,025
Variable
overhead
$83,630
$89,370
$5,740
(U
Fixed overhead
$51,200
$50,000
($1,200) )
(F
Total
$457,055
$467,870
$10,815 )
Revise the performance report using flexible budgeting and comment on the
general implications of the revised report.
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