EBK ACCOUNTING PRINCIPLES
EBK ACCOUNTING PRINCIPLES
13th Edition
ISBN: 9781119411017
Author: Weygandt
Publisher: WILEY
Question
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Chapter 25, Problem 18E

a.

To determine

Introduction: The responsibility report prepared by the management compares the performance estimated with the actual result of the operations. It helps in evaluating the profitability and efficiency of the management in cost control.

To prepare: The responsibility report for May 2020.

b.

To determine

Introduction: The management prepared a responsibility report to evaluate the efficiency in generating revenue and controlling the cost. It helps in comparing the actual and estimated controllable costs.

To write: A Memo to the owners.

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The Dinkle and Frizell Dental Clinic provides both preventive and orthodontic dental services. The two owners, Reese Dinkle and Anita Frizell, operate the clinic as two separate investment centers: Preventive Services and Orthodontic Services. Each of them is in charge of one of the centers: Reese for Preventive Services and Anita for Orthodontic Services. Each month, they prepare an income statement for the two centers to evaluate performance and make decisions about how to improve the operational efficiency and profitability of the clinic. Recently, they have been concerned about the profitability of the Preventive Services operations. For several months, it has been reporting a loss. The responsibility report for the month of May 2020 is shown below. Service revenue Variable costs: Filling materials Novocain Supplies Dental assistant wages Utilities Total variable costs Fixed costs: Allocated portion of receptionist's salary Dentist salary Equipment depreciation Allocated portion of…
Tagaytay Twilight Senior Services is a newly established corporation devoted to providing essential services to seniors who live in their own homes within the Tagaytay City and its neighboring areas. Three services are provided for seniors – home nursing, meals on wheels, and housekeeping. In the home nursing program, nurses visit seniors on a regular basis to check on their general health and perform test ordered by their physicians. The meals on wheels program delivers a hot meal once a day to each senior enrolled in the program. The housekeeping service provides weekly housecleaning and maintenance services. Data on revenue and expenses for 2017 follow:   Total Home Nursing Meals on Wheels House Keeping Revenues .................................... 900,000 260,000 400,000 240,000 Variable expenses........................ 490,000 120,000 210,000 160,000           Fixed expenses: Depreciation ............................ 68,000…
Question 2 The Bramble Dental Clinic provides both preventive and orthodontic dental services. The two owners, Reese Dinkle and Anita Frizell, operate the clinic as two separate investment centers: Preventive Services and Orthodontic Services. Each of them is in charge of one of the centers: Reese for Preventive Services and Anita for Orthodontic Services. Each month, they prepare an income statement for the two centers to evaluate performance and make decisions about how to improve the operational efficiency and profitability of the clinic.Recently, they have been concerned about the profitability of the Preventive Services operations. For several months, it has been reporting a loss. The responsibility report for the month of May 2017 is shown below.     Actual   Differencefrom Budget Service revenue   $39,000     $900 Favorable Variable costs:                 Filling materials   4,000     110 Unfavorable     Novocain   4,100     90 Unfavorable     Supplies   2,100…

Chapter 25 Solutions

EBK ACCOUNTING PRINCIPLES

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