Managerial Accounting: Tools for Business Decision Making
7th Edition
ISBN: 9781118334331
Author: Jerry J. Weygandt, Paul D. Kimmel, Donald E. Kieso
Publisher: WILEY
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Chapter 10, Problem 10.4AP
Clarke Inc. operates the Patio Furniture Division as a profit center. Operating data for this division for the year ended December 31, 2017, are as shown below.
| Budget | Difference from Budget | |
| Sales | $2,500,000 | $50,000 F |
| Cost of goods sold Variable | l,300,000 | 41,000 F |
| Controllable fixed | 200,000 | 3,000 U |
| Selling and administrative Variable | 220,000 | 6,000 U |
| Controllable fixed | 50,000 | 2,000 U |
| Noncontrollable fixed costs | 70,000 | 4,000 U |
In addition. Clarke incurs $180,000 of indirect fixed costs that were budgeted at $175,000. Twenty percent (20%) of these costs are allocated to the Patio Furniture Division.
Instructions
(a) Prepare a responsibility report for the Patio Furniture Division for the year.
(b) 
Comment on the managers performance in controlling revenues and costs.
(c) Identify any costs excluded from the responsibility report and explain why they were excluded.
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4.
Clarke Inc. operates the Patio Furniture Division as a profit center. Operating data
for this division for the year ended December 31, 202o, are as shown below.
Difference from
Budget
Budget
Sales
$2,500,000
$50,000 F
Cost of goods sold
Variable
1,300,000
41,000 F
Controllable fixed
200,000
3,000 U
Selling and administrative
Variable
220,000
6,000 U
Controllable fixed
50,000
2,000 U
Noncontrollable fixed
direct oy
70,000
4,000 U
costs
In addition, Clarke incurs $180,000 of indirect fixed costs that were budgeted at
$175,000. Twenty percent (20%) of these costs are allocated to the Patio Furniture
Division.
Instructions
a.
Prepare a responsibility report for the Patio Furniture Division for the year.
b.
Comment on the manager's performance in controlling revenues and costs.
C.
Identify any costs excluded from the responsibility report and explain why they were
excluded.
Ayayai Inc. operates the Patio Furniture Division as a profit center. Operating data for this division for the year ended December 31, 2022, are shown here.
Budget
Differencefrom Budget
Sales
$2,490,000
$45,000
Favorable
Cost of goods sold
Variable
1,290,000
36,000
Favorable
Controllable fixed
190,000
2,000
Unfavorable
Selling and administrative
Variable
210,000
6,000
Unfavorable
Controllable fixed
45,000
1,000
Unfavorable
Noncontrollable fixed costs
65,000
3,000
Unfavorable
In addition, Ayayai incurs $175,000 of indirect fixed costs that were budgeted at $170,000. Twenty percent (20%) of these costs are allocated to the Patio Furniture Division.Prepare a responsibility report for the Patio Furniture Division for the year. (List variable costs before fixed costs.)
Clarke Inc. operates the Patio Furniture Division as a profit center. Operating data for this division for the year ended December 31, 2020, are as shown below.
Budget
Differencefrom Budget
Sales
$2,490,200
$48,000
Favorable
Cost of goods sold
Variable
1,295,300
37,500
Favorable
Controllable fixed
197,900
2,500
Unfavorable
Selling and administrative
Variable
211,700
6,800
Unfavorable
Controllable fixed
50,200
1,800
Unfavorable
Noncontrollable fixed costs
68,900
4,700
Unfavorable
In addition, Clarke incurs $183,100 of indirect fixed costs that were budgeted at $175,500. Twenty percent (20%) of these costs are allocated to the Patio Furniture Division.Prepare a responsibility report for the Patio Furniture Division for the year.
Chapter 10 Solutions
Managerial Accounting: Tools for Business Decision Making
Ch. 10 - Prob. 1QCh. 10 - The following purposes are part of a budgetary...Ch. 10 - How may a budget report for the second quarter...Ch. 10 - Ken Bay questions the usefulness of a master sales...Ch. 10 - Under what circumstances may a static budget be an...Ch. 10 - A flexible budget is really a series of static...Ch. 10 - The static manufacturing overhead budget based on...Ch. 10 - A static overhead budget based on 40,000 direct...Ch. 10 - Megan Pedigo is confused about how a flexible...Ch. 10 - Call Company has prepared a graph of flexible...
Ch. 10 - The flexible budget formula is fixed costs 50,000...Ch. 10 - What is management by exception? What criteria may...Ch. 10 - What is responsibility accounting? Explain the...Ch. 10 - Prob. 14QCh. 10 - Distinguish between controllable and...Ch. 10 - How do responsibility reports differ from budget...Ch. 10 - Prob. 17QCh. 10 - Distinguish among the three types of...Ch. 10 - Prob. 19QCh. 10 - Prob. 20QCh. 10 - Prob. 21QCh. 10 - Prob. 22QCh. 10 - Prob. 23QCh. 10 - Prob. 24QCh. 10 - Prob. 25QCh. 10 - Prob. 26QCh. 10 - For the quarter ended March 31, 2017, Croix...Ch. 10 - Data for Croix Company are given in BE10-1. In the...Ch. 10 - In Rooney Company, direct labor is 20 per hour....Ch. 10 - Gundy Company expects to produce 1,200,000 units...Ch. 10 - Data for Gundy Company are given in BE10-4. In...Ch. 10 - In the Assembly Department of Hannon Company,...Ch. 10 - Torres Company accumulates the following summary...Ch. 10 - For the year ending December 31, 2017, Cobb...Ch. 10 - Prob. 10.9BECh. 10 - Prob. 10.10BECh. 10 - Prob. 10.11BECh. 10 - Prob. 10.12BECh. 10 - Wade Company estimates that it will produce 6,000...Ch. 10 - In Pargo Company's flexible budget graph, the...Ch. 10 - Prob. 10.3DICh. 10 - Prob. 10.4DICh. 10 - Connie Rice has prepared the following list of...Ch. 10 - Crede Company budgeted selling expenses of 30,000...Ch. 10 - Myers Company uses a flexible budget for...Ch. 10 - Using the information in E10-3. assume that in...Ch. 10 - Fallon Company uses flexible budgets to control...Ch. 10 - The actual selling expenses incurred in March 2017...Ch. 10 - Appliance Possible Inc. (AP) is a manufacturer of...Ch. 10 - Rensing Groomers is in the dog-grooming business....Ch. 10 - As sales manager, Joe Batista was given the...Ch. 10 - Chubbs Inc.'s manufacturing overhead budget for...Ch. 10 - UrLink Company is a newly formed company...Ch. 10 - Venetian Company has two production departments....Ch. 10 - Fey Company's Organization chart includes the...Ch. 10 - The Mixing Department manager of Malone Company is...Ch. 10 - Horatio Inc. has three divisions which are...Ch. 10 - The Sports Equipment Division of Harrington...Ch. 10 - The South Division of Wiig Company reported the...Ch. 10 - The Dinkle and Frizell Denial Clinic provides both...Ch. 10 - The Ferrell Transportation Company uses a...Ch. 10 - Presented below is selected information for three...Ch. 10 - Presenled below is selected financial information...Ch. 10 - Bumblebee Company estimates that 300,000 direct...Ch. 10 - Zelmer Company manufactures tablecloths. Sales...Ch. 10 - Ratchet Company uses budgets in controlling costs....Ch. 10 - Clarke Inc. operates the Patio Furniture Division...Ch. 10 - Optimus Company manufactures a variety of tools...Ch. 10 - Durham Company uses a responsibility reporting...Ch. 10 - Sentinel Industries has manufactured prefabricated...Ch. 10 - CURRENT DESIGNS The Current Designs staff has...Ch. 10 - Green Pastures is a 400-acre farm on the outskirts...Ch. 10 - Prob. 10.2BYPCh. 10 - Prob. 10.3BYPCh. 10 - The manufacturing overhead budget for Fleming...Ch. 10 - Ethics Case American Products Corporation...Ch. 10 - Considering Your Costs and Benefits Preparing a...
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