Flaming Foliage Sky Tours is a small sightseeing tour company in New Hampshire. The firm specializes in aerial tours of the New England countryside during September and October, when the fall color is at its peak. Until recently, the company had not had an accounting department. Routine bookkeeping tasks, such as billing, had been handled by an individual who had little formal training in accounting. As the business began to grow, however, the owner recognized the need for more formal accounting procedures. Jacqueline Frost has recently been hired as the new controller, and she will have the authority to hire an assistant. During her first week on the job, Frost was given the following performance report. The report was prepared by Red Leif, the company's manager of aircraft operations, who was planning to present it to the owner the next morning. "Look at these favorable variances for fuel and so forth," Leif pointed out, as he showed the report to Frost. "My operations people are really doing a great job." Later that day, Frost looked at the performance report more carefully. She immediately realized that it was improperly prepared and would be misleading to the company's owner. Passenger revenue Less: Variable expenses: Fuel Aircraft maintenance Flight crew salaries. Selling and administrative Total variable expenses Contribution margin Less: Fixed expenses: Depreciation on aircraft Landing fees Supervisory salaries. Selling and administrative Total fixed expenses Operating income FLAMING FOLIAGE SKY TOURS Performance Report For the Month of September Formula Flexible Budget (per air mile) $ 16.00 $ 1.50 2.20 1.20 2.30 $ 7.20 $ 8.80 Per Month $ 9,800 3,800 35,000 44,000 $ 92,600 Actual (21,000 air miles) $336,000 $ 35,000 44,200 27,000 45,900 $152,100 $ 183,900 $ 9,800 5,000 33,000 49,300 $ 97,100 $ 86,800 Static Budget (25,000 air miles) $ 400,000 $ 37,500 55,000 30,000 57,500 $ 180,000 $ 220,000 $ 9,800 3,800 35,000 44,000 $ 92,600 $ 127,400 Variance $ 64,000 $ 2,500 10,800 3,000 11,600 $ 27,900 $36,100 $0 1,200 2,000 5,300 $4,500 $ 40,600 U F F F F F U UFUUU

Symphony Electronics produces wireless speakers for outdoor use on patios, decks, etc. Their most popular model is the All Weather and requires four separate XL12 components per unit. The company is now planning raw material needs for the second quarter. Sales of the All Weather are the highest in the second quarter of each year as customers prepare for the summer season. The company has the following inventory requirements: a. The finished goods inventory on hand at the end of each month must be equal to 16,400 units plus 10% of the next month's sales. The finished goods inventory on March 31 is budgeted to be 28,700 units. b. The raw materials inventory on hand at the end of each month must be equal to 20% of the following month's production needs for raw materials. The raw materials inventory on March 31 for XL 12 is budgeted to be 98,800 components. c. The company maintains no work in process inventories. A sales budget for the All Weather speaker is as follows: April May June July…

Shawke Company's partially completed flexible overhead budget for the current period follows. This budget is based on its predicted activity of 50% of productive capacity. Complete its flexible overhead budgets for the current period using 1,950, 3,900, and 5,850 units of productive capacity. For Year Ended December 31 Production (in units) Overhead costs Total variable overhead Total fixed overhead Total overhead costs Flexible Overhead Budgets Total Fixed Cost Variable Amount per Unit $ 12 $ 17,900 Flexible Budget at Capacity Level of 25% 50% 75% 1,950 3,900 5,850

You are given the following budgeted and actual data for the Grey Company for each of the months January through June of the current year. In December of the prior year, sales were forecasted as follows: January, 100 units February, 95 units March, 102 units April, 107 units May, 114 units June, 122 units. In January of the current year, sales for the months February through June were reforecasted as follows: February, 90 units March, 102 units April, 102 units May, 104 units June, 117 units.  In February of the current year, sales for the months March through June were reforecasted as follows: March, 97 units April, 102 units May, 99 units June, 117 units In March of the current year, sales for the months April through June were reforecasted as follows: April, 102 units May, 94 units June, 107 units In April of the current year, sales for the months May and June were reforecasted as follows: May, 84 units June, 102 units In May of the current year, sales for June were…