Exam 9: Flexible Budgets and Performance Analysis

Cearns Memorial Diner is a charity supported by donations that provides free meals to the homeless.The diner's budget for December is to be based on 3, 900 meals.The diner's director has provided the following cost formulas to use in the budget: Required: Prepare the diner's budget for the month of December.The budget will only contain the costs listed above;no revenues will be on the budget.

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 administrative expenses in January would be closest to:

Vangemert Corporation uses customers served as its measure of activity.During June, the company budgeted for 22, 000 customers, but actually served 25, 000 customers.The company uses the following revenue and cost formulas in its budgeting, where q is the number of customers served: Revenue: $5.30q Wages and salaries: $35, 400 + $1.90q Supplies: $0.70q Insurance: $9, 600 Miscellaneous expense: $5, 000 + $0.10q The company reported the following actual results for June: Required: Prepare a report showing the company's revenue and spending variances for June.Label each variance as favorable (F)or unfavorable (U).

Vanderhyde 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, 300 tenant-days, but its actual level of activity was 3, 340 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 administrative expenses in the planning budget for May would be closest to:

Coderre 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, 800 units, but its actual level of activity was 7, 780 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 spending variance for direct materials in July would be closest to:

Sorrow 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 November, the kennel budgeted for 2, 300 tenant-days, but its actual level of activity was 2, 350 tenant-days.The kennel 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 activity variance for administrative expenses in November would be closest to:

Federick Clinic uses client-visits as its measure of activity.During October, the clinic budgeted for 3, 000 client-visits, but its actual level of activity was 3, 040 client-visits.The clinic 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 occupancy expenses in October would be closest to:

Pearse 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 3, 000 tenant-days, but its actual level of activity was 2, 980 tenant-days.The kennel 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 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 December would be closest to:

Hettinger Hospital bases its budgets on patient-visits.The hospital's static budget for March appears below: The total fixed cost at the activity level of 7, 700 patient-visits per month should be:

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 food and supplies in the flexible budget for October would be closest to:

Diemert Corporation bases its budgets on machine-hours.The company's static planning budget for June appears below: Actual results for the month were: The spending variance for supplies costs in the flexible budget performance report for the month should be:

Loggin Midwifery's cost formula for its wages and salaries is $2, 380 per month plus $231 per birth.For the month of April, the company planned for activity of 100 births, but the actual level of activity was 102 births.The actual wages and salaries for the month was $25, 510.The spending variance for wages and salaries in April 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 administrative expenses in the planning budget for July 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 revenue variance for February would be closest to:

Liscomb 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 October, the school budgeted for 1, 520 students and 113 courses.The school's income statement showing the actual results for the month appears below: Required: Prepare a report showing the school's activity variances for October.Label each variance as favorable (F)or unfavorable (U).

A static planning budget is:

Halm Urban Diner is a charity supported by donations that provides free meals to the homeless.The diner's budget for August was based on 3, 000 meals.The diner's director has provided the following cost data to use in the budget: groceries, $3.85 per meal;kitchen operations, $4, 600 per month plus $1.15 per meal;administrative expenses, $3, 800 per month plus $0.85 per meal;and fundraising expenses, $1, 600 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).

Lineback Corporation bases its budgets on the activity measure customers served.During April, the company planned to serve 33, 000 customers, but actually served 30, 000 customers.The company uses the following revenue and cost formulas in its budgeting, where q is the number of customers served: Revenue: $2.60q Wages and salaries: $26, 000 + $0.70q Supplies: $0.50q Insurance: $5, 400 Miscellaneous expense: $2, 700 + $0.20q Required: Prepare a report showing the company's activity variances for April.Indicate in each case whether the variance is favorable (F)or unfavorable (U).

Hagel Clinic uses client-visits as its measure of activity.During July, the clinic budgeted for 2, 300 client-visits, but its actual level of activity was 2, 320 client-visits.The clinic 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 spending variance for occupancy expenses in July 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 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 August would be closest to: