Penelope's People Care manufactures two products, loofahs (selling price $11.00) and scrubbing brushes (selling price $5.50). Expected sales for the year were 43,500 loofahs and 22,100 brushes. The budgeted cost of goods sold in each case was 40% of the selling price. Actual sales were 46,300 loofahs and 20,100 brushes. The cost of goods sold were $178,255 loofahs and $46,431 brushes.

Budget and actual period costs were:

Budget $

Actual $

Sales Salaries and commissions

95,700

106,953

Advertising

47,850

45,837

Depreciation

28,000

28,000

Office expenses

119,625

106,300

1. Prepare performance report for the income statement for the year, showing unit sales, gross profit, net profit and all variances from budget in dollars and percentages using any suitable financial management software.
2. Prepare plan and timeline with critical dates for preparation of Penelope's budgets for the next financial year. You will be required to give recommendations detailing variances, performance and evaluation for Penelope's people care
3. What if Penelope's people care plans to add a new item, how it is going to affect this planning?
4. How will the manager circulate the performance report in line with company reporting requirements?

Answer rating: 100% (QA)

To prepare the performance report Ill first calculate the budgeted and actual figures and then compute the variances After that Ill create a plan and ... View the full answer