Exam 8: Flexible Budgets and Performance Analysis

Roye Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During September, the kennel budgeted for 3,300 tenant-days, but its actual level of activity was 3,330 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for September: Data used in budgeting: Actual results for September: -The overall revenue and spending variance (i.e. ,the variance for net operating income in the revenue and spending variance column on the flexible budget performance report)for September would be closest to:

Yewston Hotel bases its budgets on guest-days. The hotel's static budget for April appears below: -The total fixed cost at the activity level of 3,400 guest-days per month should be:

Stuchlik Catering uses two measures of activity,jobs and meals,in the cost formulas in its budgets and performance reports.The cost formula for catering supplies is $430 per month plus $80 per job plus $14 per meal.A typical job involves serving a number of meals to guests at a corporate function or at a host's home.The company expected its activity in January to be 20 jobs and 190 meals,but the actual activity was 21 jobs and 194 meals.The actual cost for catering supplies in January was $4,850.The catering supplies in the planning budget for January would be closest to:

Sterr Air uses two measures of activity, flights and passengers, in the cost formulas in its budgets and performance reports. The cost formula for plane operating costs is $49,340 per month plus $2,635 per flight plus $2 per passenger. The company expected its activity in January to be 73 flights and 191 passengers, but the actual activity was 75 flights and 193 passengers. The actual cost for plane operating costs in January was $246,440. -The plane operating costs in the flexible budget for January would be closest to:

Schlick Framing's cost formula for its supplies cost is $1,770 per month plus $12 per frame.For the month of August,the company planned for activity of 628 frames,but the actual level of activity was 631 frames.The actual supplies cost for the month was $9,790.The activity variance for supplies cost in August would be closest to:

Parisi Clinic uses client-visits as its measure of activity. During March, the clinic budgeted for 2,300 client-visits, but its actual level of activity was 2,350 client-visits. The clinic has provided the following data concerning the formulas to be used in its budgeting: -The medical supplies in the flexible budget for March would be closest to:

Mcquain Boat Wash's cost formula for its cleaning equipment and supplies is $1,950 per month plus $20 per boat. For the month of June, the company planned for activity of 85 boats, but the actual level of activity was 125 boats. The actual cleaning equipment and supplies for the month was $4,380. -The activity variance for cleaning equipment and supplies in June would be closest to:

Schoeppner Corporation uses customers served as its measure of activity.During October,the company budgeted for 39,000 customers,but actually served 42,000 customers.The company bases its budgets on the following information: Revenue should be $3.10 per customer served.Wages and salaries should be $38,100 per month plus $0.80 per customer served.Supplies should be $0.40 per customer served.Insurance should be $9,600 per month.Miscellaneous expenses should be $3,400 per month plus $0.40 per customer served.The company reported the following actual results for October: Required: Prepare the company's flexible budget performance report for October.Label each variance as favorable (F)or unfavorable (U).

Galante Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During May, the kennel budgeted for 3,400 tenant-days, but its actual level of activity was 3,380 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for May: Data used in budgeting: Actual results for May: -The net operating income in the flexible budget for May would be closest to:

Lotson Corporation bases its budgets on machine-hours. The company's static planning budget for May appears below: Actual results for the month were: -The spending variance for power costs in the flexible budget performance report for the month should be:

Meares Corporation bases its budgets on the activity measure customers served.During May,the company plans to serve 27,000 customers.The company has provided the following data concerning the formulas it uses in its budgeting: Required: Prepare the company's planning budget for May.

Kuramoto Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During June, the company budgeted for 7,600 units, but its actual level of activity was 7,560 units. The company has provided the following data concerning the formulas to be used in its budgeting: -The activity variance for net operating income in June would be closest to:

Askland Clinic uses client-visits as its measure of activity. During October, the clinic budgeted for 3,100 client-visits, but its actual level of activity was 3,130 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for October: Data used in budgeting: Actual results for October: -The medical supplies in the flexible budget for October would be closest to:

Oscarson Midwifery's cost formula for its wages and salaries is $2,720 per month plus $351 per birth.For the month of September,the company planned for activity of 121 births,but the actual level of activity was 119 births.The actual wages and salaries for the month was $43,380.The wages and salaries in the planning budget for September would be closest to:

Cadavieco Detailing's cost formula for its materials and supplies is $1,990 per month plus $8 per vehicle. For the month of November, the company planned for activity of 92 vehicles, but the actual level of activity was 52 vehicles. The actual materials and supplies for the month was $2,440. -The materials and supplies in the flexible budget for November would be closest to:

Fongeallaz Clinic bases its budgets on the activity measure patient-visits.During January,the clinic planned for 2,300 patient-visits,but its actual level of activity was 2,100 patient-visits.Revenue should be $52.50 per patient-visit.Personnel expenses should be $34,100 per month plus $15.10 per patient-visit.Medical supplies should be $1,600 per month plus $8.40 per patient-visit.Occupancy expenses should be $9,400 per month plus $1.90 per patient-visit.Administrative expenses should be $3,500 per month plus $0.10 per patient-visit. Required: Prepare a report showing the clinic's activity variances for January.Indicate in each case whether the variance is favorable (F)or unfavorable (U).

Gourley Clinic uses client-visits as its measure of activity. During August, the clinic budgeted for 3,200 client-visits, but its actual level of activity was 3,160 client-visits. The clinic has provided the following data concerning the formulas to be used in its budgeting: -The activity variance for net operating income in August would be closest to:

Foxworthy Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During July, the kennel budgeted for 2,000 tenant-days, but its actual level of activity was 2,050 tenant-days. The kennel has provided the following data concerning the formulas to be used in its budgeting: -The net operating income in the planning budget for July would be closest to:

Hanekamp Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During August, the company budgeted for 5,400 units, but its actual level of activity was 5,440 units. The company has provided the following data concerning the formulas to be used in its budgeting: -The net operating income in the flexible budget for August would be closest to:

Snyders Kennel uses tenant-days as its measure of activity; an animal housed in the kennel for one day is counted as one tenant-day. During October, the kennel budgeted for 2,600 tenant-days, but its actual level of activity was 2,610 tenant-days. The kennel has provided the following data concerning the formulas to be used in its budgeting: -The activity variance for administrative expenses in October would be closest to: