Exam 9: Flexible Budgets and Performance Analysis

Guareno Clinic uses client-visits as its measure of activity. During December, the clinic budgeted for 2,500 client-visits, but its actual level of activity was 2,450 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for December: Data used in budgeting: Actual results for December: -The administrative expenses in the planning budget for December would be closest to:

Dubberly Corporation's cost formula for its manufacturing overhead is $30,600 per month plus $64 per machine-hour. For the month of March, the company planned for activity of 7,900 machine-hours, but the actual level of activity was 7,880 machine-hours. The actual manufacturing overhead for the month was $558,610. -The activity variance for manufacturing overhead in March would be closest to:

Tomlison Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During October, the company budgeted for 5,100 units, but its actual level of activity was 5,150 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 October would be closest to:

Dinham 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 March, the kennel budgeted for 2,000 tenant-days, but its actual level of activity was 2,040 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for March: Data used in budgeting: Actual results for March: -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 March would be closest to:

Kawamura 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 December, the kennel budgeted for 2,300 tenant-days, but its actual level of activity was 2,320 tenant-days. The kennel has provided the following data concerning the formulas to be used in its budgeting: -The wages and salaries in the planning budget for December would be closest to:

Neeb Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During January, the company budgeted for 7,000 units, but its actual level of activity was 7,040 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for January: Data used in budgeting: Actual results for January: -The activity variance for selling and administrative expenses in January would be closest to:

Lenci Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During May, the company budgeted for 5,100 units, but its actual level of activity was 5,050 units. The company 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 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 May would be closest to:

Brong Corporation is a shipping container refurbishment company that measures its output by the number of containers refurbished. The company has provided the following fixed and variable cost estimates that it uses for budgeting purposes and the actual results of operations for March. When the company prepared its planning budget at the beginning of March, it assumed that 22 containers would have been refurbished. However, 18 containers were actually refurbished during March. -The spending variance for "Refurbishing materials" for March would have been closest to:

Bartosiewicz Clinic uses client-visits as its measure of activity. During January, the clinic budgeted for 3,500 client-visits, but its actual level of activity was 3,490 client-visits. The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for January: Data used in budgeting: Actual results for January: -The activity variance for net operating income in January would be closest to:

Feemster Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During October, the company budgeted for 5,900 units, but its actual level of activity was 5,850 units. The company 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 activity variance for direct labor in October would be closest to:

Salina Clinic uses patient-visits as its measure of activity.The clinic has provided the following report: Required: Prepare the clinic's flexible budget performance report for February.Label each variance as favorable (F)or unfavorable (U).

A flexible budget performance report contains activity variances but not revenue or spending variances.

Hubbard 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 January, the kennel budgeted for 2,100 tenant-days, but its actual level of activity was 2,060 tenant-days. The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for January: Data used in budgeting: Please keep the heads "Data usd in budgeting:" This makes it absolutely clear that the table immediately below the head is for budgeting and the table that follows are actual results. Actual results for January: -The facility expenses in the flexible budget for January would be closest to:

Pratte Boat Wash's cost formula for its cleaning equipment and supplies is $2,460 per month plus $49 per boat. For the month of April, the company planned for activity of 58 boats, but the actual level of activity was 18 boats. The actual cleaning equipment and supplies for the month was $3,470. Why such a great disparity between the planned and actual level of activity from 58 to 18 boats - should these be closer together? Please keep as is. Such a large discrepancy is ok. -The cleaning equipment and supplies in the planning budget for April would be closest to:

Trevorrow 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 6,200 units, but its actual level of activity was 6,160 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for June: Data used in budgeting: Actual results for June: -The net operating income in the planning budget for June would be closest to:

Neeb Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During January, the company budgeted for 7,000 units, but its actual level of activity was 7,040 units. The company has provided the following data concerning the formulas used in its budgeting and its actual results for January: Data used in budgeting: Actual results for January: -The spending variance for manufacturing overhead in January would be closest to:

An unfavorable activity variance for revenue indicates that activity was less than expected when the static planning budget was developed.

Arrasmith Corporation uses customers served as its measure of activity.During February,the company budgeted for 35,000 customers,but actually served 34,000 customers.The company uses the following revenue and cost formulas in its budgeting,where q is the number of customers served: Revenue: $3.50q Wages and salaries: $33,200 + $1.10q Supplies: $0.50q Insurance: $10,400 Miscellaneous expense: $6,400 + $0.30q The company reported the following actual results for February: Required: Prepare the company's flexible budget performance report for February.Label each variance as favorable (F)or unfavorable (U).

A spending variance is the difference between the amount of the cost in the static planning budget and the amount of the cost in the flexible budget.

Picozzi Snow Removal's cost formula for its vehicle operating cost is $2,060 per month plus $306 per snow-day.For the month of January,the company planned for activity of 16 snow-days,but the actual level of activity was 18 snow-days.The actual vehicle operating cost for the month was $7,720.The vehicle operating cost in the planning budget for January would be closest to: