Dreckman Corporation is a service company that measures its output by the number of customers served. The company has provided the following fixed and variable cost estimates that it uses for budgeting purposes and the actual results of operations for August.| | Fixed Element per Month | Variable Element per Customer Served | Actual Total for August ||----------------------------------------|--------------------------|--------------------------------------|-------------------------|| **Revenue** | | $4,000 | $125,500 || **Employee salaries and wages** | $46,600 | $900 | $74,700 || **Travel expenses** | | $600 | $18,800 || **Other expenses** | $33,100 | | $33,500 |When the company prepared its planning budget at the beginning of August, it assumed that 36 customers would have been served. However, 31 customers were actually served during August.The “Other expenses” in the flexible budget for August would have been closest to:a. $33,500 b. $38,903 c. $28,847 d. $33,100

The flexible budget is prepared for actual level of production on the basis of standard rates. Fir…

Dreckman Corporation is a service company that measures its output by the number of customers served. The company has provided the following fixed and variable cost estimates that it uses for budgeting purposes and the actual results of operations for August. Actual Total for August $ 125,500 $74,700 and wages $ 18,800 Travel expenses Other expenses $ 33,100 $33,500 When the company prepared its planning budget at the beginning of August, it assumed that 36 Revenue Employee salaries Fixed Element per Variable Element per Month Customer Served $4,000 $ 900 $600 $46,600

Dreckman Corporation is a service company that measures its output by the number of customers served. The company has provided the following fixed and variable cost estimates that it uses for budgeting purposes and the actual results of operations for August. Actual Total for August $ 125,500 $74,700 and wages $ 18,800 Travel expenses Other expenses $ 33,100 $33,500 When the company prepared its planning budget at the beginning of August, it assumed that 36 Revenue Employee salaries Fixed Element per Variable Element per Month Customer Served $4,000 $ 900 $600 $46,600

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Vala
Pearl, Inc. has prepared the operating budget for the first quarter of the year. The company forecast sales of $45,000 in January, $55,000 in February, and $65,000 in March. Variable and fixed selling and administrative expenses are as follows: Variable Expenses: Power cost Miscellaneous expenses Fixed Expenses: Salaries expense Rent expense Depreciation expense Power cost/fixed portion Miscellaneous expense/fixed portion OA. $35,300 OB. $40,300 OC. $22,500 OD. $45,300 (40% of sales) (10% sales) $6,000 per month $4,000 per month $1,000 per month $800 per month $1,000 per month
The direct labor budget of Yuvwell Corporation for the upcoming fiscal year contains the following details concerning budgeted direct labor-hours: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Budgeted direct labor-hours 9,000 8,700 9,000 8,400 The company uses direct labor-hours as its overhead allocation base. The variable portion of its predetermined manufacturing overhead rate is $3.25 per direct labor-hour and its total fixed manufacturing overhead is $58,000 per quarter. The only noncash item included in fixed manufacturing overhead is depreciation, which is $14,500 per quarter. Required: Prepare the company’s manufacturing overhead budget for the upcoming fiscal year. Compute the company’s predetermined overhead rate (including both variable and fixed manufacturing overhead) for the upcoming fiscal year.
Arrasmith Corporation uses customers served as its measure of activity. During February, the company budgeted for 36.100 customers, but actually served 27.900 customers. The company uses the following revenue and cost formules in its budgeting, where is the number of customers served: Revenue: $4.60q Wages and salaries: $34,300+ $1.43q Supplies: $0.83q Insurance: $11,500 Miscellaneous expenses: $7,500 + $0.41q The company reported the following actual results for February: $ 141,800 $ 69,100 $ 15,500 $ 11,500 $ 23,200 Revenue Wages and salaries Supplies Insurance Miscellaneous expense Required: Prepare the company's flexible budget performance report for February. Label each variance as favorable (F) or unfavorable (U). Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (.e., zero variance). Input all amounts as positive values. Customers served Revenue Expenses: Wages and salaries Supplies Insurance Miscellaneous…
A company provides the following information from its original planning budget, and for its actual results for the month of April: Budgeted Fixed Selling Costs: $101,000 Budgeted Sales Volume: 30,000 units Actual Fixed Selling Costs: $93,000 Actual Sales Volume; 31,000 units If the company creates a Flexible Budget for April, what amount should they list for fixed selling costs on the flexible budget? (Round to the nearest dollar.)
Ellington, SRL is developing their manufacturing overhead budget for February, which is based on budgeted direct labor hours. The variable overhead rate is $16.40 per direct labor hour and 7,900 direct labor hours are budgeted for February. Fixed manufacturing overhead is budgeted at $67,000. All overhead costs are current cash flows except for $10,720 of depreciation. What should the manufacturing overhead budget indicate for cash disbursements for manufacturing overhead for the month of February?
Yuvwell Corporation's direct labor budget for next year contained the following information: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter 8,600 8,500 8,200 8,800 Budgeted direct labor-hours The company uses direct labor-hours as its overhead allocation base. The variable portion of its predetermined manufacturing overhead rate is $2.75 per direct labor-hour and its total fixed manufacturing overhead is $54,000 per quarter. The only noncash item included in fixed manufacturing overhead is depreciation of $13,500 per quarter. Required: 1. Prepare the company's manufacturing overhead budget for next year. 2. Compute the company's predetermined overhead rate (including both variable and fixed manufacturing overhead) for next year. Complete this question by entering your answers in the tabs below. Required 1 Required 2 Prepare the company's manufacturing overhead budget for next year. Note: Round "Variable manufacturing overhead rate" answers to 2 decimal places. Variable manufacturing…
1. Prepare a budgeted income statement for the month ended July 31st. Use an absorption format. a. Calculate the estimated operating cycle for the month of July. (Hint: Use 30 days in the numerator to calculate the average collection period and the average sales period.)
Lenci Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During May, the company budgeted for 5,100 units, but its actual level of activity was 5,050 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for May: Data used in budgeting: Revenue Direct labor Direct materials Manufacturing overhead Selling and administrative expenses Total expenses Actual results for May: Revenue Direct labor Direct materials Fixed element per month 41,500 22,700 $ 64,200 $ 197,810 $ 28,565 $ 80,265 $ 47,905 $ 22,680 $0 $0 0 Manufacturing overhead Selling and administrative expenses The spending variance for direct materials in May would be closest to: Variable element per unit $ 39.60 $ 5.50 15.70 1.30 0.20 $ 22.70
The following are the budgeted and actual income statements for Tucan Ltd, a manufacturing business, for the month of January: Budget Output (production and sales) Sales revenue Raw materials Labour Fixed overheads Operating profit Output (production and sales) Sales revenue Raw materials Labour Fixed overheads 5,000 units Flexed budget £ 500,000 200,000 150,000 70,000 80,000 £ units Actual 6,000 units £ 630,000 270,000 150,000 78,000 132,000 C
During June, Tarras Corporation plans to serve 46,000 customers. The company uses the following revenueand cost formulas in its budgeting, where Q is the number of customers served. Revenue:$4.40Q Wages and salaries:$34,600 + $1.67Q Supplies:$0.87Q Insurance:$15,000 Miscellaneous expenses:$5,600 + $0.57Q Required:Prepare the company's planning budget for June. Show all your calculations and you may round youranswers to the nearest dollar.
Annie’s Homemade Ice Cream is preparing a planning budget for August. Its budgeted revenue per serving is $5.00. It has identified two cost drivers—number of servings and number of labor-hours. The company expects to sell 10,800 servings and to staff 700 employee labor-hours in August. Data concerning the company’s cost formulas are shown below: Fixed Cost Per MonthCost per ServingCost per Labor-HourIngredients expense $ 1.25 Salaries and wages expense$ 7,000 $ 8.00Franchise fee $ 0.25 Credit card processing fees $ 0.09 Utilities expense$ 300$ 0.02 Rent expense$ 3,000 Equipment depreciation expense$ 1,750 Other expenses$ 4,200 In August, the company actually sold 11,200 servings of ice cream and staffed 780 employee labor-hours. It’s budgeted