Exam 9: Flexible Budgets and Performance Analysis

Monard Clinic uses client-visits as its measure of activity.During January, the clinic budgeted for 3, 700 client-visits, but its actual level of activity was 3, 710 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 personnel expenses in January would be closest to:

Gastineau Tile Installation Corporation measures its activity in terms of square feet of tile installed.Last month, the budgeted level of activity was 1, 230 square feet and the actual level of activity was 1, 200 square feet.The company's owner budgets for supply costs, a variable cost, at $2.70 per square foot.The actual supply cost last month was $2, 690.In the company's flexible budget performance report for last month, what would have been the spending variance for supply costs?

Harmison Urban Diner is a charity supported by donations that provides free meals to the homeless.The diner's budget for July was based on 3, 000 meals, but the diner actually served 3, 500 meals.The diner's director has provided the following cost data to use in the budget: groceries, $2.60 per meal;kitchen operations, $4, 300 per month plus $1.80 per meal;administrative expenses, $3, 100 per month plus $0.80 per meal;and fundraising expenses, $1, 200 per month. Required: Prepare a report showing the activity variances for each of the expenses and for total expenses for July.Label each variance as favorable (F)or unfavorable (U).

Dancause 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, 090 units.The company has provided the following data concerning the formulas to be used in its budgeting: The direct materials in the flexible budget for October would be closest to:

Perla 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, 200 tenant-days, but its actual level of activity was 2, 160 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 revenue variance for March would be closest to:

Larance Detailing's cost formula for its materials and supplies is $2, 230 per month plus $1 per vehicle.For the month of November, the company planned for activity of 75 vehicles, but the actual level of activity was 25 vehicles.The actual materials and supplies for the month was $2, 160. The materials and supplies in the flexible budget for November would be closest to:

Hepburn Clinic uses client-visits as its measure of activity.During July, the clinic budgeted for 3, 200 client-visits, but its actual level of activity was 3, 180 client-visits.The clinic has provided the following data concerning the formulas to be used in its budgeting for July: The personnel expenses in the planning budget for July would be closest to:

Poljak Tech is a for-profit vocational school.The school bases its budgets on two measures of activity (i.e. , cost drivers), namely student and course.The school uses the following data in its budgeting: In February, the school budgeted for 1, 970 students and 137 courses.The school's income statement showing the actual results for the month appears below: Required: Prepare a report showing the school's revenue and spending variances for February.Label each variance as favorable (F)or unfavorable (U).

Lynne 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 $480 per month plus $91 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 June to be 10 jobs and 79 meals, but the actual activity was 14 jobs and 77 meals.The actual cost for catering supplies in June was $2, 970.The catering supplies in the flexible budget for June would be closest to:

Tabeling 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 6, 500 units, but its actual level of activity was 6, 540 units.The company has provided the following data concerning the formulas used in its budgeting and its actual results for August: Data used in budgeting: Actual results for August: The net operating income in the flexible budget for August would be closest to:

Viel Urban Diner is a charity supported by donations that provides free meals to the homeless.The diner's budget for April was based on 3, 100 meals, but the diner actually served 3, 300 meals.The diner's director has provided the following cost data to use in the budget: groceries, $3.95 per meal;kitchen operations, $5, 200 per month plus $1.40 per meal;administrative expenses, $3, 300 per month plus $0.80 per meal;and fundraising expenses, $1, 800 per month. Required: Prepare the diner's flexible budget for the actual number of meals served in April.The budget will only contain the costs listed above;no revenues will be on the budget.

An unfavorable spending variance may reflect waste as well as paying too much for inputs.

Sonner Tech is a for-profit vocational school.The school bases its budgets on two measures of activity (i.e. , cost drivers), namely student and course.The school uses the following data in its budgeting: In September, the school budgeted for 1, 760 students and 156 courses.The actual activity for the month was 1, 560 students and 153 courses. Required: Prepare the school's flexible budget for the actual level of activity in September.

Buonocore Clinic uses client-visits as its measure of activity.During August, the clinic budgeted for 2, 800 client-visits, but its actual level of activity was 2, 770 client-visits.The clinic has provided the following data concerning the formulas used in its budgeting and its actual results for August: Data used in budgeting: Actual results for August: The spending variance for medical supplies in August would be closest to:

Smithj 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 February, the kennel budgeted for 3, 500 tenant-days, but its actual level of activity was 3, 490 tenant-days.The kennel has provided the following data concerning the formulas used in its budgeting and its actual results for February: Data used in budgeting: Actual results for February: The spending variance for facility expenses in February would be closest to:

Hammes 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 5, 500 units, but its actual level of activity was 5, 510 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 February would be closest to:

Tammo Jeep Tours operates jeep tours in the heart of the Colorado Rockies.The company bases its budgets on two measures of activity (i.e. , cost drivers), namely guests and jeeps.One vehicle used in one tour on one day counts as a jeep.Each jeep has one tour guide.The company uses the following data in its budgeting: In June, the company budgeted for 430 guests and 172 jeeps.The actual activity for the month was 440 guests and 171 jeeps. Required: Prepare the company's planning budget for June.

Satoe Corporation uses customers served as its measure of activity.During April, the company budgeted for 25, 000 customers, but actually served 23, 000 customers.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: Required: Prepare the company's flexible budget performance report for April.Label each variance as favorable (F)or unfavorable (U).

Lartey Corporation's cost formula for its selling and administrative expense is $22, 200 per month plus $27 per unit.For the month of December, the company planned for activity of 5, 300 units, but the actual level of activity was 5, 270 units.The actual selling and administrative expense for the month was $168, 150. The selling and administrative expense in the planning budget for December would be closest to:

Nicolini 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, 200 tenant-days, but its actual level of activity was 2, 250 tenant-days.The kennel 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 spending variance for food and supplies in October would be closest to: