Managerial Accounting (5th Edition)
5th Edition
ISBN: 9780134128528
Author: Karen W. Braun, Wendy M. Tietz
Publisher: PEARSON
expand_more
expand_more
format_list_bulleted
Concept explainers
Videos
Textbook Question
Chapter 9, Problem 9.26AE
Delta Labs performs a specialty lab test for local companies for $45 per test. For the upcoming quarter, Delta Labs is projecting the following sales:
The budgeted cost of performing each test is $21. Operating expenses are projected to be $59,000 in January, $57,000 in February, and $58,000 in March. Delta Labs is subject to a corporate tax rate of 30%.
Expert Solution & Answer
Want to see the full answer?
Check out a sample textbook solution
Students have asked these similar questions
Given the following information, prepare an annual income statement budget for the Great Student Corporation as of 12/31/2018.
1. Sales: 1000 Units; Price $1,000 per Unit
2. Cost of Goods Sold (COGS): 60% of Sales
3. Wages: 15 Employees; Average Cost per Employee $15000
4. SGA Expenses: 12% of Sales
5. Depreciation: Straight Line $4000 per year
6. Interest Expense: 1% of Sales
What was the company's budgeted gross profit?
O A. $403,000
O B. $400,000
O C. $41,000
O D. $359,000
Week 6
South Hampton University is preparing its budget for the upcoming academic year. This is a specialised private university that charges fees for all degree courses. Currently, 30,000 students are enrolled on campus. However, the university is forecasting a 5 per cent growth in student numbers in the coming year, despite an increase in fees to $3,000 per subject. The following additional information has been gathered from an examination of university records and conversations with university managers:
South Hampton is planning to award scholarships to 200 students, which will cover their fees.
The average class has 80 students, and the typical student takes 4 subjects per semester. South Hampton operates 2 semesters per year.
The average academic staff salary is $120,000 per annum including on-costs.
South Hampton’s academic staff are evaluated on the basis of teaching, research, administration
and professional/community service. Each of the academic staff…
ing price of $26 per case. The following information relates to the budget for Main Street
a flexible budget performance report (Learning Objective 5)
Main Street Muffins sells its muffins to restaurants and coffee houses for an average sell-
Muffins for this year (all figures are annual totals unless otherwise noted):
Performance Evaluation
629
E10-26A Prepare
Budgeted sales in cases
9,100 cases
Packaging cost per case.
%24
Shipping expense per case
Sales commission expense.
2
5% of sales price
Salaries expense..
$6,500
Office rent
$3,900
Depreciation.
$2,500
Insurance expense...
$1,800
$ 900
Office supplies expense.
During the year, Main Street Muffins actually sold 9,500 cases, resulting in total sales rev-
enue of $255,200. Actual expenses (in total) from this year are as follows:
Packaging cost.
$ 10,600
$ 19,500
$ 12,760
$ 7,300
Shipping expense..
Sales commission expense.
Salaries expense...
$ 3,900
$ 2,500
$ 1,600
Office rent
Depreciation.
Insurance expense..
$ 1,600
Office…
Chapter 9 Solutions
Managerial Accounting (5th Edition)
Ch. 9 - (Learning Objective 1) Which term describes the...Ch. 9 - (Learning Objective 1) Benefits of budgeting...Ch. 9 - Prob. 3QCCh. 9 - Prob. 4QCCh. 9 - Prob. 5QCCh. 9 - Prob. 6QCCh. 9 - Prob. 7QCCh. 9 - Prob. 8QCCh. 9 - Prob. 9QCCh. 9 - Prob. 10QC
Ch. 9 - Short Exercises S9-1 Order of preparation and...Ch. 9 - Explain why companies use zero-based budgeting...Ch. 9 - Understanding key terms and definitions (Learning...Ch. 9 - Sales Budget (Learning Objective 2) Jefferson...Ch. 9 - Production budget (Learning Objective 2) Nichols...Ch. 9 - Direct materials budget (Learning Objective 2)...Ch. 9 - Prob. 9.7SECh. 9 - Prob. 9.8SECh. 9 - Prob. 9.9SECh. 9 - Prob. 9.10SECh. 9 - Prob. 9.11SECh. 9 - Cash payments budget (Learning Objective 3) Finley...Ch. 9 - Cash budget (Learning Objective 3) SaveCo...Ch. 9 - Prob. 9.14SECh. 9 - Prob. 9.15SECh. 9 - Identify ethical standards violated (Learning...Ch. 9 - Prob. 9.17AECh. 9 - Sales budget for a retail organization (Learning...Ch. 9 - Prob. 9.19AECh. 9 - Production budget (Learning Objective 2) Hoffman...Ch. 9 - Direct materials budget (Learning Objective 2)...Ch. 9 - Production and direct materials budgets (Learning...Ch. 9 - Direct labor budget (Learning Objective 2)...Ch. 9 - Manufacturing overhead budget (Learning Objective...Ch. 9 - Operating expenses budget and an income statement...Ch. 9 - Budgeted income statement (Learning Objective 2)...Ch. 9 - Prob. 9.27AECh. 9 - Cash collections budget (Learning Objective 3)...Ch. 9 - Cash payments budget (Learning Objective 3) The...Ch. 9 - Prob. 9.30AECh. 9 - Prob. 9.31AECh. 9 - Budgeted balance sheet (Learning Objective 3) Use...Ch. 9 - Prob. 9.33AECh. 9 - Prob. 9.34AECh. 9 - Cost of goods sold, inventory, and purchases...Ch. 9 - Cost of goods sold, inventory, and purchases...Ch. 9 - Prob. 9.37BECh. 9 - Prob. 9.38BECh. 9 - Prob. 9.39BECh. 9 - Prob. 9.40BECh. 9 - Direct materials budget (Learning Objective 2) Moe...Ch. 9 - Prob. 9.42BECh. 9 - Prob. 9.43BECh. 9 - Manufacturing overhead budget (Learning Objective...Ch. 9 - Prob. 9.45BECh. 9 - Prob. 9.46BECh. 9 - Prob. 9.47BECh. 9 - Prob. 9.48BECh. 9 - Prob. 9.49BECh. 9 - Combined cash budget (Learning Objective 3)...Ch. 9 - Sales and cash collections budgets (Learning...Ch. 9 - Prob. 9.52BECh. 9 - Prob. 9.53BECh. 9 - Prob. 9.54BECh. 9 - Prob. 9.55BECh. 9 - Prob. 9.56BECh. 9 - Comprehensive budgeting problem (Learning...Ch. 9 - Cash budgets under two alternatives (Learning...Ch. 9 - Comprehensive summary problem (Learning Objectives...Ch. 9 - Prob. 9.60APCh. 9 - Cash budgets (Learning Objective 3) Elis...Ch. 9 - Prob. 9.62APCh. 9 - Cost of goods sold, inventory, and purchases...Ch. 9 - Prob. 9.64APCh. 9 - Problems Group B P9-65B Comprehensive budgeting...Ch. 9 - Cash budgets under two alternatives (Learning...Ch. 9 - Comprehensive summary problem (Learning Objectives...Ch. 9 - Prob. 9.68BPCh. 9 - Cash budgets (Learning Objective 3) Ivans...Ch. 9 - Combined cash budget and a budgeted balance sheet...Ch. 9 - Prob. 9.71BPCh. 9 - Prepare comprehensive budgets for a retailer...Ch. 9 - Prob. 9.73SCCh. 9 - Discussion Questions 1. The sales budget is the...Ch. 9 - Budgeting for a Single Product In this activity,...Ch. 9 - Ethics and budgetary slack (Learning Objectives 1,...Ch. 9 - Prob. 9.77ACT
Knowledge Booster
Learn more about
Need a deep-dive on the concept behind this application? Look no further. Learn more about this topic, accounting and related others by exploring similar questions and additional content below.Similar questions
- Anderson Labs performs a specialty lab test for local companies for $50 per test. For the upcoming quarter, Anderson Labs is projecting the following sales: The budgeted cost of performing each test is $24. Operating expenses are projected to be $57,000 in January, $52,000 in February, and $61,000 in March. Anderson Labs is subject to a corporate tax rate of 30%. Requirement Prepare a budgeted income statement for the first quarter, with a column for each month and for the quarter. January February March Number of lab tests 5,900 4,700 5,200 ..... Prepare the budgeted income statement by first calculating the operating income, then calculate the net income. Anderson Labs Budgeted Income Statement For the Quarter Ended March 31 January February March Quarter Sales Less: Cost of goods sold Gross profit Less: Operating expenses Operating income Less: Income tax expense Net income .....arrow_forwardQ) South Hampton University is preparing its budget for the upcoming academic year. This is a specialised private university that charges fees for all degree courses. Currently, 30,000 students are enrolled on campus. Howerver, the university is forecasting a 5 percent growth in student numbers in the coming year, despite an increase in fees to $3,000 per subject. The following additional information has been gathered from an examination of university records and conversations with university managers: (i) South Hampton is planning to award scholarships to 200 students, which will cover their fees. (ii) The average class has 80 students, and the typical student takes 4 subjects per semester. South Hampton operates 2 semester per year. (iii) The average academic staff salary is $120,000 per annum including on-costs. (iv) South Hampton's academic staff are evaluated on the basis of teaching, research, administration and professional/community service. Each of the academic…arrow_forwardShawnTech is a for-profit vocational school. The school bases its budgets on two measures of activity (i.e., cost drivers), namely student and course. The school uses the following data in its budgeting: Fixed element per month variable element per student variable element per course revenue $0 $354 $0 faculty wages $0 $0 $2,300 course supplies $0 $48 $40 administrative expenses $41,700 $13 $21 In October, the school budgeted for 1,400 students and 127 courses. The actual activity for the month was 1,500 students and 129 courses. Prepare a report showing the school's activity variances for October. Label each variance as favorable (F) or unfavorable (U).arrow_forward
- Roberds Tech is a for-profit vocational school. The school bases its budgets on two measures of activity (i.e., cost drivers), namely student and course. The school uses the following data in its budgeting: Fixed element per month Variable element per student Variable element per course Revenue $ 0 $ 298 $ 0 Faculty wages $ 0 $ 0 $ 3,100 Course supplies $ 0 $ 52 $ 40 Administrative expenses $ 26,500 $ 27 $ 52 In March, the school budgeted for 1,910 students and 88 courses. The school's income statement showing the actual results for the month appears below: Roberds Tech Income Statement For the Month Ended March 31 Actual students 1,810 Actual courses 91 Revenue $ 411,340 Expenses: Faculty wages 214,950 Course supplies 62,590 Administrative expenses 84,562 Total expense 362,102 Net operating income $ 49,238 Required: Prepare a flexible budget performance report showing both the school's activity variances and revenue and spending…arrow_forwardSouth Hampton University is preparing its budget for the upcoming academic year. This is a specializedprivate university that charges fees for all degree courses. Currently, 30,000 students are enrolled oncampus. However, the university is forecasting a 5 percent growth in student numbers in the comingyear, despite an increase in fees to $3,000 per subject. The following additional information has beengathered from an examination of university records and conversations with university managers: South Hampton is planning to award scholarships to 200 students, which will cover their fees. The average class has 80 students, and the typical student takes 4 subjects per semester. SouthHampton operates 2 semesters per year. The average academic staff salary is $120,000 per annum including on-costs. South Hampton’s academic staff are evaluated on the basis of teaching, research, administration, and professional/community service. Each of the academic staff teaches the equivalent of…arrow_forwardProvided that you have received start-up funding of $250 000.00 for any business of your choice, prepare a forecast where costs associated with required business resources are outline and create a budget for the first two months of the business. Calculate the break-even point.arrow_forward
- Roberds Tech is a for-profit vocational school. The school bases its budgets on two measures of activity (i.e., cost drivers), namely student and course. The school uses the following data in its budgeting: Revenue Faculty wages Course supplies Administrative expenses Actual students Actual courses Revenue Expenses: Faculty wages Course supplies Administrative expenses Total expense Net operating income In March, the school budgeted for 1,720 students and 69 courses. The school's income statement showing the actual results for the month appears below: Roberds Tech Income Statement For the Month Ended March 31 Students Courses Revenue Expenses: Fixed element per month Faculty wages Course supplies Administrative expenses $0 $0 $0 $ 25,550 Total expense Net operating income Variable element per student $203 $0 $33 Required: Prepare a flexible budget performance report showing both the school's activity variances and revenue and spending variances for March. Label each variance as…arrow_forwardHudson Community College enrolls students in two departments, Liberal Arts and Sciences. The college also has two service departments, the Library and the Computing Services Department. The usage of these two service departments' output for the year is as follows: User of Service Library Computing Services Liberal Arts Sciences Library Computing Services Provider of Service Computing Library Services 10% The budgeted costs in the two service departments for the year are as follows: Provider of Service 60% 40% Library Computing Services Total $700,000 270,000 Required: 1. Use the direct method to allocate the budgeted costs of the Library and Computing Services Department to the college's Liberal Arts and Sciences departments. (Do not round intermediate calculations.) 20% 70% Liberal Arts Sciencesarrow_forwardHudson Community College enrolls students in two departments, Liberal Arts and Sciences. The college also has two service departments, the Library and the Computing Services Department. The usage of these two service departments' output for the year is as follows: User of Service Library Computing Services Liberal Arts Sciences Provider of Service Computing Services 20% Library Computing Services Library 65% 35% The budgeted costs in the two service departments for the year are as follows: $1,090,000 550,000 30% 50% Required: 1. Use the step-down method to allocate Hudson Community College's service department costs to the Liberal Arts and Sciences departments. (Do not round intermediate calculations.) Allocation of Computing Service costs Allocation of Library costs Total costs allocated to each department Liberal Arts Sciencesarrow_forward
- South Hampton University is preparing its budget for the upcoming academic year. Thisis a specialised private university that charges fees for all degree courses. Currently, 30 000students are enrolled on campus. However, the university is forecasting a 5 per cent growthin student numbers in the coming year, despite an increase in fees to $3 000 per subject. Thefollowing additional information has been gathered from an examination of university recordsand conversations with university managers:1. South Hampton is planning to award scholarships to 200 students, which will covertheir fees.2. The average class has 80 students, and the typical student takes 4 subjects persemester. South Hampton operates 2 semesters per year.3. The average academic staff salary is $120 000 per annum including on-costs.4. South Hampton’s academic staff are evaluated on the basis of teaching, research,administration and professional/community service. Each of the academic staffteaches the equivalent of three…arrow_forwardSouth Hampton University is preparing its budget for the upcoming academic year. Thisis a specialised private university that charges fees for all degree courses. Currently, 30 000students are enrolled on campus. However, the university is forecasting a 5 per cent growthin student numbers in the coming year, despite an increase in fees to $3 000 per subject. Thefollowing additional information has been gathered from an examination of university recordsand conversations with university managers:1. South Hampton is planning to award scholarships to 200 students, which will covertheir fees.2. The average class has 80 students, and the typical student takes 4 subjects persemester. South Hampton operates 2 semesters per year.3. The average academic staff salary is $120 000 per annum including on-costs.4. South Hampton’s academic staff are evaluated on the basis of teaching, research,administration and professional/community service. Each of the academic staffteaches the equivalent of three…arrow_forwardJohnston Bookstore is the bookstore on campus for students and faculty. The bookstore E9-18A Sales budget for a retail organization (Learning Objective 2) shows the following sales projections in units by quarter for the upcoming year School Supplies Apparel Miscellaneous Quarter Books 1,570 200 580 690 1st. ..... 2nd 800 190 330 540 3rd 1,790 240 880 890 4th 670 180 540 440 The average price of an item in each of the departments is as follows: Average sales price per unit Books.. $85 School supplies Apparel.. Miscellaneous. $18 $29 $ 6 Requirement Prepare a sales budget for the upcoming year by quarter for the Johnston Bookstore, with sales categorized by the four product groupings (books, school supplies, apparel, and miscellaneous).arrow_forward
arrow_back_ios
SEE MORE QUESTIONS
arrow_forward_ios
Recommended textbooks for you
AccountingAccountingISBN:9781337272094Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.Publisher:Cengage Learning,
Accounting Information SystemsAccountingISBN:9781337619202Author:Hall, James A.Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...AccountingISBN:9780134475585Author:Srikant M. Datar, Madhav V. RajanPublisher:PEARSON
Intermediate AccountingAccountingISBN:9781259722660Author:J. David Spiceland, Mark W. Nelson, Wayne M ThomasPublisher:McGraw-Hill Education
Financial and Managerial AccountingAccountingISBN:9781259726705Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting PrinciplesPublisher:McGraw-Hill Education
Accounting
Accounting
ISBN:9781337272094
Author:WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:Cengage Learning,
Accounting Information Systems
Accounting
ISBN:9781337619202
Author:Hall, James A.
Publisher:Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis...
Accounting
ISBN:9780134475585
Author:Srikant M. Datar, Madhav V. Rajan
Publisher:PEARSON
Intermediate Accounting
Accounting
ISBN:9781259722660
Author:J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:9781259726705
Author:John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:McGraw-Hill Education
Responsibility Accounting| Responsibility Centers and Segments| US CMA Part 1| US CMA course; Master Budget and Responsibility Accounting-Intro to Managerial Accounting- Su. 2013-Prof. Gershberg; Author: Mera Skill; Rutgers Accounting Web;https://www.youtube.com/watch?v=SYQ4u1BP24g;License: Standard YouTube License, CC-BY