163. On the basis of the following data for Branch Co. for the year ended December 31, 2011 and the preceding year, prepare a statement of cash flows using the indirect method of reporting cash flows from operating activities. Assume that equipment costing $125,000 was purchased for cash and the land was sold for $15,000. The stock was issued for cash and the only entries […]
41. The technique that ranks employees into predetermined categories or groups according to performance is called: A. forced distribution. B. high/low ranking system. C. paired comparison. D. strictness. The forced distribution method uses a ranking format. In forced distribution employees are grouped into three, four, or five categories usually of unequal size indicating the best workers, the worst workers, and one or more categories in between. […]
90. Giorgio had cost of goods sold of $9,421 million, ending inventory of $2,089 million, and average inventory of $1,965 million. Its inventory turnover equals: A. 0.21.B. 4.51C. 4.79.D. 76.1 days.E. 80.9 days. 91. Perfection Company had cost of goods sold of $853,000, ending inventory of $70,500, and average inventory of $71,600. Its inventory turnover equals: A. 11.9.B. 1.0C. 6.0.D. 30.6.E. 12.0. 92. Beckenworth had cost of goods sold of $9,421 million, ending […]
11. The summary of significant accounting principles, a required part of the financial statement notes, must include a statement about the parent’s consolidation policy. If an investor does not consolidate a significant majority-owned subsidiary, the notes will disclose that fact. 12. If an entity qualifies as a variable interest entity (VIE), U.S. GAAP requires the primary beneficiary of the VIE to consolidate the VIE. […]
41) Y Company obtained the following balances from its computerized accounting information system at the end of the year before adjustments: Accounts receivable$ 27,000 Allowance for uncollectible accounts (3,000) Net sales100,000 Bad debts expense0 The company estimates that 20% of accounts receivable will be uncollectible. After the correct adjusting entry has been made, bad debts expense for the year will be: […]
41) A decision as to whether to insource or outsource is a(n), 41) ______ A) idle capacity decision. B) short-run focus decision. C) production scheduling analysis. D) product mix decision. E) make/buy decision. 42) Crest Information Technologies manufactures three sizes of copiers: light usage, medium usage, and heavy usage. Potential sales include 200 units of light, 240 units of medium, and 200 units of […]
81.In which of the following situations would an adjusting entry be made at the end of January to record an accrued expense? A. Ramona’s Nursery purchased playground equipment on January 1 with an estimated useful life of six years. B. On January 25, Ramona’s Nursery hired a college student to drive the minibus; the new employee is to begin work in February. C. January […]
13.4 Learning Objective 13-4 1) No entry was recorded to reinstate a bad debt when making a collection. The allowance method is being used. This error would cause: A) total assets to be overstated. B) total liabilities to be understated. C) net income to be understated. D) None of these are correct. 2) The journal entry to write off an account judged to […]
109.Six months ago, a company purchased an investment in stock for $70,000. The investment is classified as available-for-sale securities. The current fair value of the stock is $68,500. The company should record a: A.Debit to Unrealized Loss—Equity for $1,500. B.Credit to Unrealized Gain—Equity for $1,500. C.Debit to Investment Revenue for $1,500. D.No entry is required. E.Credit to Investment Revenue for $1,500. 110.On July 31, […]
76. Which of the following would be included in the cost of a product manufactured according to variable costing? A. sales commissionsB. property taxes on factory buildingsC. interest expenseD. direct materials 77. On the variable costing income statement, the figure representing the difference between manufacturing margin and contribution margin is the: A. fixed manufacturing costsB. variable cost of goods soldC. fixed selling and administrative expensesD. variable selling and administrative expenses 78. In the variable […]
Flexible Budget
For this assignment, refer to the scenario located in “Problems Series A,” section 8-19A of Ch. 8, “Performance Evaluation,“ of Fundamentals of Managerial Accounting Concepts. This scenario puts you in charge of preparing a budget for the Redmond Management Association annual public relations luncheon.
Read the scenario in the textbook and complete the activity below.
Use Excel spreadsheet by showing all work and formulas to complete the following:
Prepare a flexible budget.
Compute the sales volume variance and the variable cost volume variances based on a comparison between the master budget and the flexible budget.
Compute flexible budget variances by comparing the flexible budget with the actual results.
Create a 6- to 8-slide presentation for the budget committee meeting. Complete the following in your presentation:
1. Summarize the results of the sales volume and variable cost volume variances computations based on the comparison between the master budget and the flexible budget.
2. Summarize the results of the flexible budget variances computations based on the comparison between the flexible budget and the actual results.
3. Justify the favorable or unfavorable budget variances.
4. Since this is a not-for-profit organization, address why anyone should be concerned with meeting the budget.
5. Make recommendations for what can be done differently to stay on budget for future luncheons. Provide specific examples to support your recommendations.
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