Exam 8: Flexible Budgets and Performance Analysis

Mouton Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During July, the company budgeted for 7,300 units, but its actual level of activity was 7,350 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for July: Data used in budgeting: Actual results for July: -The direct labor in the planning budget for July would be closest to:

Fullagar Corporation's cost formula for its manufacturing overhead is $15,400 per month plus $11 per machine-hour. For the month of May, the company planned for activity of 7,500 machine-hours, but the actual level of activity was 7,540 machine-hours. The actual manufacturing overhead for the month was $102,710. -The manufacturing overhead in the planning budget for May would be closest to:

If activity is higher than expected,total variable costs should be higher than expected.If activity is lower than expected,total variable costs should be lower than expected.

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 cleaning equipment and supplies in the flexible budget for June would be closest to:

Akes Urban Diner is a charity supported by donations that provides free meals to the homeless.The diner's budget for August was based on 2,200 meals.The diner's director has provided the following cost data to use in the budget: groceries,$3.65 per meal;kitchen operations,$5,400 per month plus $1.85 per meal;administrative expenses,$2,900 per month plus $0.55 per meal;and fundraising expenses,$1,700 per month.The director has also provided the diner's statement of actual expenses for the month: Required: Prepare a flexible budget performance report showing both the activity variances and the spending variances for each of the expenses and for total expenses for August.Label each variance as favorable (F)or unfavorable (U).

Stivason Clinic uses client-visits as its measure of activity. During September, the clinic budgeted for 3,300 client-visits, but its actual level of activity was 3,290 client-visits. The clinic 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 activity variance for administrative expenses in September 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 net operating income in the flexible budget for March would be closest to:

MacPhail Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During April, the company budgeted for 5,600 units, but its actual level of activity was 5,650 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for April: Data used in budgeting: Actual results for April: -The revenue variance for April would be closest to:

During August,Diga Corporation plans to serve 35,000 customers.The company uses the following revenue and cost formulas in its budgeting,where q is the number of customers served: Revenue: $4.20q Wages and salaries: $33,700 + $1.50q Supplies: $0.70q Insurance: $11,000 Miscellaneous: $4,800 + $0.40q Required: Prepare the company's planning budget for August.

Albers Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During April, the company budgeted for 7,600 units, but its actual level of activity was 7,570 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for April: Data used in budgeting: Actual results for April: -The activity variance for net operating income in April would be closest to:

MacPhail Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During April, the company budgeted for 5,600 units, but its actual level of activity was 5,650 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for April: Data used in budgeting: Actual results for April: -The spending variance for manufacturing overhead in April would be closest to:

Wayland Corporation's static planning budget for April appears below. The company bases its budgets on machine-hours. In April, the actual number of machine-hours was 6,600, the actual supplies cost was $64,040, the actual power cost was $7,070, the actual salaries cost was $88,300, and the actual equipment depreciation was $7,430. -The spending variance for power cost in the flexible budget performance report for the month should be:

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 spending variance for materials and supplies in November would be closest to:

Privitera Printing uses two measures of activity, press runs and book set-ups, in the cost formulas in its budgets and performance reports. The cost formula for wages and salaries is $7,220 per month plus $650 per press run plus $1,110 per book set-up. The company expected its activity in January to be 188 press runs and 117 book set-ups, but the actual activity was 191 press runs and 114 book set-ups. The actual cost for wages and salaries in January was $269,270. -The wages and salaries in the flexible budget for January would be closest to:

Whit 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 $380 per month plus $94 per job plus $11 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 October to be 20 jobs and 216 meals,but the actual activity was 19 jobs and 221 meals.The actual cost for catering supplies in October was $4,790.The catering supplies in the flexible budget for October would be closest to:

Caballes Clinic uses client-visits as its measure of activity. During November, the clinic budgeted for 3,100 client-visits, but its actual level of activity was 3,070 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for November: Data used in budgeting: Actual results for November: -The personnel expenses in the planning budget for November would be closest to:

Cayouette Clinic uses patient-visits as its measure of activity.During February,the clinic budgeted for 2,400 patient-visits,but its actual level of activity was 2,700 patient-visits.The clinic uses the following revenue and cost formulas in its budgeting,where q is the number of patient-visits: Revenue: $53.80q Personnel expenses: $32,000 + $16.60q Medical supplies: $700 + $8.80q Occupancy expenses: $10,400 + $1.90q Administrative expenses: $5,500 + $0.20q The clinic reported the following actual results for February: Required: Prepare the clinic's flexible budget performance report for February.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 activity variance for net operating income in May would be closest to:

Dukeman Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During February, the company budgeted for 7,100 units, but its actual level of activity was 7,060 units. The company has provided the following data concerning the formulas to be used in its budgeting: -The selling and administrative expenses in the planning budget for February would be closest to:

During August,Cardenas Clinic budgeted for 3,900 patient-visits,but its actual level of activity was 3,800 patient-visits.The clinic uses the following revenue and cost formulas in its budgeting,where q is the number of patient-visits: Revenue: $27.80q Personnel expenses: $25,100 + $7.80q Medical supplies: $1,100 + $5.60q Occupancy expenses: $7,900 + $1.20q Administrative expenses: $3,200 + $0.10q Required: Prepare the clinic's flexible budget for August based on the actual level of activity for the month.