Budgetary Control and Responsibility Accounting
ASSIGNMENT CLASSIFICATION TABLE
Brief Exercises A Problems B Problems
Study Objectives 1. Describe the concept of budgetary control. Evaluate the usefulness of static budget reports. Explain the d
Colt Company uses budgets in controlling costs. The August 2011 budget report for the
companys Assembling Department is as follows.
The monthly budget amounts in the report were based on an expected production of
60,000 units per month or 720,000 unit
Colt Industries had sales in 2010 of $6,400,000 and gross profit of $1,100,000. Management is
considering two alternative budget plans to increase its gross profit in 2011.
Plan A would increase the selling price per unit from $8.00 to $8.40. Sales volume