Garbera Enterprises manufactures tires for the Formula 1 motor racing circuit. For August 2017, it budgeted...
Fantastic news! We've Found the answer you've been seeking!
Question:
Transcribed Image Text:
Garbera Enterprises manufactures tires for the Formula 1 motor racing circuit. For August 2017, it budgeted to manufacture and sell 2,800 tires at a variable cost of $78 per tire and total fixed costs of $56,500. The budgeted selling price was $112 per tire. Actual results in August 2017 were 2,500 tires manufactured and sold at a selling price of $113 per tire. The actual total variable costs were $212,500, and the actual total fixed costs were $52,500. Read the requirements. Requirement 1. Prepare a performance report that uses a flexible budget and a static budget. Begin with the actual results, then complete the flexible budget columns and the static budget columns. Label each variance as favorable or unfavorable. (For variances with a $0 balance, make sure to enter "0" in the appropriate field. If the variance is zero, do not select a label.) Units sold Revenues Variable costs Contribution margin Fixed costs Operating income Actual Results Requirements 1. Prepare a performance report that uses a flexible budget and a static budget. 2. Comment on the results in requirement 1. X Garbera Enterprises manufactures tires for the Formula 1 motor racing circuit. For August 2017, it budgeted to manufacture and sell 2,800 tires at a variable cost of $78 per tire and total fixed costs of $56,500. The budgeted selling price was $112 per tire. Actual results in August 2017 were 2,500 tires manufactured and sold at a selling price of $113 per tire. The actual total variable costs were $212,500, and the actual total fixed costs were $52,500. Read the requirements. Requirement 1. Prepare a performance report that uses a flexible budget and a static budget. Begin with the actual results, then complete the flexible budget columns and the static budget columns. Label each variance as favorable or unfavorable. (For variances with a $0 balance, make sure to enter "0" in the appropriate field. If the variance is zero, do not select a label.) Units sold Revenues Variable costs Contribution margin Fixed costs Operating income Actual Results Requirements 1. Prepare a performance report that uses a flexible budget and a static budget. 2. Comment on the results in requirement 1. X
Expert Answer:
Answer rating: 100% (QA)
SOLUTION To prepare the performance report using a flexible budget and a static budget we will compare the actual results with the budgeted amounts Le... View the full answer
Related Book For
Horngrens Cost Accounting A Managerial Emphasis
ISBN: 978-0134475585
16th edition
Authors: Srikant M. Datar, Madhav V. Rajan
Posted Date:
Students also viewed these accounting questions
-
Flexible budget. Sweeney Enterprises manufactures tires for the Formula I motor racing circuit. For August 2017, it budgeted to manufacture and sell 3,600 tires at a $71 per tire and total fixed...
-
Abulafia Srl manufactures tyres for the Formula 1 motor racing circuit. For August 2008, Abulafia budgeted to manufacture and sell 3000 tyres at a variable cost of 74 per tyre and a total fixed cost...
-
Abulafia Srl manufactures tyres for the Formula 1 motor racing circuit. For August 2015 Abulafia budgeted to manufacture and sell 3000 tyres at a variable cost of 74 per tyre and a total fixed cost...
-
What is the probability that the number X of successes in the personnel managers sample of 100 employees in question 10 will be 48 or more?
-
Your firm has an average receipt size of $117. A bank has approached you concerning a lockbox service that will decrease your total collection time by two days. You typically receive 6,500 checks per...
-
How many moles of water decompose to yield 0.500 mol of oxygen gas? 2 H 2 O(l) 2 H 2 (g) + O 2 (g) (a) 0.250 mol (b) 0.500 mol (c) 1.00 mol (d) 2.00 mol (e) None of the above.
-
Explain the purpose of letters for underwriters.
-
Blink-On Company maintains and repairs warning lights, such as those found on radio towers and lighthouses. Blink-On Company prepared the end-of-period spreadsheet (work sheet) at the top of the...
-
The spot exchange rate of ETB/USD is 9.8600. The one-year interest rates of the U.S. Dollar and Ethiopian Birr are 3.23% and 6.50%, respectively. (a) What is the one-year outright forward of ETB/USD?...
-
As a financial analyst at Glencolin International (GI) you have been asked to revisit your analysis of the two capital investment alternatives submitted by the production department of the firm....
-
-Which of the following analyses would be best to use to detect very large skimming schemes? A. Vertical analysis B. Horizontal analysis C. Ratio analysis D. Diagonal analysis
-
A company is considering a 3-year investment project and will use a cost of capital of 10% p.a. to evaluate it. The project will cost $180,000 upfront (year 0) and the company's corporate tax rate is...
-
You sold short 2,000 shares of a company for $40.00 per share in May 2022. You are worried about the market turning bullish, so you decide to buy 20 call options on the company's shares with each...
-
Discuss how the Lyft company you have chosen has been able to create a sustainable competitive advantage Based on your own research, identify and discuss the role that technology and information...
-
BZD, a calendar year corporation, made the following year-end accruals for 2023 financial statement purposes: Required: a. $73,000 expense and $73,000 liability for unpaid December salaries. BZD paid...
-
Garden Depot is a retailer that provided the following budgeted cash flows for next year: Total cash receipts Total cash disbursements 1st Quarter $ 180,000 2nd Quarter $ 330,000 3rd Quarter $...
-
Consider an election with 491 votesa) If there are 5 candidates, what is the smallest number offirst-place votes a candidate could win with under the Pluralitymethod? votesb) If there are 7 candid 2...
-
D Which of the following is considered part of the Controlling activity of managerial accounting? O Choosing to purchase raw materials from one supplier versus another O Choosing the allocation base...
-
Carpenter Company uses standard costing. The company has a manufacturing plant in Georgia. Standard labor-hours per unit are 0.50, and the variable overhead rate for the Georgia plant is $3.50 per...
-
Comment on the following statement. In a normal-costing system, the amounts in the Manufacturing Overhead Control account will always equal the amounts in the Manufacturing Overhead Allocated account?
-
The following data are for Arizona Retail Outlet Stores. The account balances (in thousands) are for 2017 Marketing and advertising costs..............................................$ 55,200...
-
True or false? Explain: hierarchy reduces complexity because A. It reduces the size of individual modules. B. It cuts down on the number of interconnections between elements. C. It assembles a number...
-
True or false? Explain: modularity reduces complexity because A. It reduces the effect of incommensurate scaling. B. It helps control propagation of effects.
-
Consider the part of the file system naming hierarchy illustrated in the following: a. In the path name and in the figure, identify the context that you should use for that resolution and the context...
Study smarter with the SolutionInn App