Chapter_23_Solutions_7e

Chapter_23_Solutions_7e - Chapter 23 Flexible Budgets and...

Info iconThis preview shows pages 1–8. Sign up to view the full content.

View Full Document Right Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon

Info iconThis preview has intentionally blurred sections. Sign up to view the full version.

View Full DocumentRight Arrow Icon
This is the end of the preview. Sign up to access the rest of the document.

Unformatted text preview: Chapter 23 Flexible Budgets and Standard Costs Quick Check Answers: 1. d 3. a 5. c 7. d 9. a 2. b 4. e 6. c 8. b 10. a Explanations: 1. d. $17,750 = (75 $130) + $8,000 2. b. Static budget [(100 $130) + 8,000] $21,000 Flexible budget (from #1) 17,750 Sales volume variance $ 3,250 F 3. a. Flexible budget variance ($5,250U) = Flexible budget (from #1) ($17,750) Actual costs ($23,000) 5. c. $105U = Actual price Standard price) Actual quantity ($15.50 / DLH $15 / DLH) 210 DLH 6. c. $225F = (Actual quantity Standard quantity Standard price (210 DLH 225 DLH* $15 / DLH *75 connectors 3 DLH / connector Chapter 23 Flexible Budgets and Standard Costs 221 8. b. Predetermined standard = $5,250 + $8,000 manufacturing overhead rate 1,000 machine hours = $13.25 / machine hour Accounting 7/e Solutions Manual 222 Short Exercises (10 min.) S 23-1 1. d 2. e 3. a 4. c 5. b (10 min.) S 23-2 1. f 2. a 3. d 4. b 5. c 6. e Chapter 23 Flexible Budgets and Standard Costs 223 (10 min.) S 23-3 Boje, Inc. Flexible Budget Month Ended April 30, 2007 Flexible Budget Output Units (Locks) per Output Unit 4,000 6,000 Sales revenue $15 $60,000 $90,000 Variable expenses $10 40,000 60,000 Fixed expenses 15,000 15,000 Total expenses 55,000 75,000 Operating income (loss) $ 5,000 $15,000 Accounting 7/e Solutions Manual 224 (10-15 min.) S 23-4 Boje, Inc. Income Statement Performance Report (partial) Month Ended April 30, 2007 Actual Results at Actual Prices Flexible Budget Variance Flexible Budget for Actual Number of Output Units Output units (travel locks) 5,000-0- 5,000 Sales revenue $80,000 $ 5,000F $75,000 Variable expenses 52,000 (2,000)U 50,000 Fixed expenses 16,000 (1,000 )U 15,000 Total expenses 68,000 (3,000 )U 65,000 Operating income $12,000 $ 2,000 F $10,000 Chapter 23 Flexible Budgets and Standard Costs 225 (5 min.) S 23-5 a. The static budget is developed at the beginning of the period . b. The flexible budget used in an income statement performance report is based on the actual number of outputs . c. The master budget is based on the expected number of outputs . d. The flexible budget used in an income statement performance report is developed at the end of the period . e. The difference between actual costs and the costs that should have been incurred for the actual number of outputs is the flexible budget variance . Accounting 7/e Solutions Manual 226 (10-15 min.) S 23-6 Actual price per pound = $0.50 Standard price per pound = $0.40 Actual quantity = 7,000 bottles 1.1 lb. / bottle = 7,700 lbs. Standard quantity allowed = 7,000 bottles 1 lb. per bottle for actual number of outputs = 7,000 lbs. Direct materials price variance: Actual price Standard price Actual quantity per input unit per input unit of input ($0.50 / lb. $0.40 / lb.) (7,700 lbs.) = $770 U Direct materials efficiency variance: Actual quantity Standard quantity of input Standard price of input allowed for actual outputs per input unit...
View Full Document

This note was uploaded on 05/05/2010 for the course BUSINESS 71395 taught by Professor Brown during the Spring '09 term at Miss. College.

Page1 / 86

Chapter_23_Solutions_7e - Chapter 23 Flexible Budgets and...

This preview shows document pages 1 - 8. Sign up to view the full document.

View Full Document Right Arrow Icon
Ask a homework question - tutors are online