ACCT 1B Study Guide - Final Guide: Deutsche Luft Hansa, Budget, Intelligent Dance Music

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amethysthyena724

16 Jun 2020

School

Irvine Valley College

Department

Accounting

Course

ACCT 1B

Professor

Seilo

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Document Summary

Flexible budget: projects budget data for various levels of activity. It is a series of static budgets at various levels of activity. Flexible budgets can be done for all budgets in the master budget. Marriot can do sales budget on basis of 60%, 80% and 100% occupancy. Static budget prepared for oh based on 10,000 units. Demand is up for product and actually produce 12,000. This is a good thing; means more profit. But if you look at budget to actual analysis of costs, budget report shows unfavorable differences for idm, idl and utilities. Shows they are significantly over budget on 3 of 6 costs. But comparing data from 12,000 actual units to budget of 10,000 is irrelevant; meaningless comparison. As production increases the budget should allow for variable costs to increase. If you compare budget at 12,000 units to actual at 12,000, turns out there is an favorable variance.

Related Questions

I need some feedback if these are correct.
1.
A flexible budget is a budget that:
A) is updated with actual costs as they occur during theperiod.
B) is updated to reflect the actual level of activity during theperiod.
C) is prepared using a computer spreadsheet application.
D) contains only variable production costs.
2.
Ofarrell Snow Removal's cost formula for its vehicle operating costis $1,840 per month plus $377 per snow-day. For the month ofNovember, the company planned for activity of 14 snow-days, but theactual level of activity was 19 snow-days. The actual vehicleoperating cost for the month was $9,280. The vehicle operating costin the flexible budget for November would be closest to:
A) $9,003
B) $7,118
C) $9,280
D) $9,660
3.
Entler Framing's cost formula for its supplies cost is $2,250 permonth plus $16 per frame. For the month of June, the companyplanned for activity of 502 frames, but the actual level ofactivity was 497 frames. The actual supplies cost for the month was$10,580. The supplies cost in the planning budget for June would beclosest to:
A) $10,580
B) $10,282
C) $10,686
D) $10,202
4.
Johannsen Catering uses two measures of activity, jobs and meals,in the cost formulas in its budgets and performance reports. Thecost formula for catering supplies is $310 per month plus $103 perjob plus $23 per meal. A typical job involves serving a number ofmeals to guests at a corporate function or at a host's home. Thecompany expected its activity in February to be 28 jobs and 187meals, but the actual activity was 26 jobs and 192 meals. Theactual cost for catering supplies in February was $7,620. Thecatering supplies in the flexible budget for February would beclosest to:
A) $7,495
B) $7,404
C) $7,620
D) $6,960
5.
Kimbril Catering uses two measures of activity, jobs and meals, inthe cost formulas in its budgets and performance reports. The costformula for catering supplies is $530 per month plus $91 per jobplus $12 per meal. A typical job involves serving a number of mealsto guests at a corporate function or at a host's home. The companyexpected its activity in January to be 27 jobs and 174 meals, butthe actual activity was 31 jobs and 173 meals. The actual cost forcatering supplies in January was $5,330. The activity variance forcatering supplies in January would be closest to:
A) $255 F
B) $255 U
C) $352 F
D) $352 U
6.
Lapinsky Air uses two measures of activity, flights and passengers,in the cost formulas in its budgets and performance reports. Thecost formula for plane operating costs is $31,400 per month plus$2,148 per flight plus $7 per passenger. The company expected itsactivity in April to be 89 flights and 261 passengers, but theactual activity was 84 flights and 260 passengers. The actual costfor plane operating costs in April was $204,810. The spendingvariance for plane operating costs in April would be closestto:
A) $8,842 U
B) $19,589 F
C) $19,589 U
D) $8,842 F
7.
Velten Corporation's flexible budget performance report for lastmonth shows that actual indirect materials cost, a variable cost,was $45,198 and that the spending variance for indirect materialscost was $9,114 favorable. During that month, the company worked18,600 machine-hours. Budgeted activity for the month had been19,000 machine-hours. The cost formula per machine-hour forindirect materials cost must have been closest to:
A) $1.90
B) $2.86
C) $1.94
D) $2.92
8.
Which of the following comparisons best isolates the impact thatchanges in prices of inputs and outputs have on performance?
A) static planning budget and flexible budget
B) static planning budget and actual results
C) flexible budget and actual results
D) master budget and static planning budget
9.
The excess or deficiency of cash available over disbursements onthe cash budget is calculated as follows:
A) The beginning balance less the expected cash receipts less theexpected cash disbursements.
B) The cash available less the expected cash receipts plus theexpected cash disbursements.
C) The beginning balance plus the expected cash receipts less theexpected cash disbursements.
D) None of the above.
10.
There are various budgets within the master budget. One of thesebudgets is the production budget. Which of the following BESTdescribes the production budget?
A) It details the required direct labor hours.
B) It details the required raw materials purchases.
C) It is calculated based on the sales budget and the desiredending inventory.
D) It summarizes the costs of producing units for the budgetperiod.
1.B
2.A
3.A
4.C
5.D
6.C
7.A
8.B
9.A
10.C

magentabat295

Acct 505 project 1 Managerial Accounting 15th Edition Garrison,Noreen, and Brewer 2014 McGraw-Hill

COURSE PROJECT 1 INSTRUCTIONS

You have just been contracted as a budget consultant by LBJCompany, a distributor of bracelets to various retail outletsacross the country. The company has done very little in the way ofbudgeting and at certain times of the year has experienced ashortage of cash.

You have decided to prepare a cash budget for the upcomingfourth quarter in order to show management the benefits that can begained from proper cash planning. You have worked with accountingand other areas to gather the information assembled below.

The company sells many styles of bracelets, but all are sold forthe same $10 price. Actual sales of bracelets for the last threemonths and budgeted sales for the next six months follow:

July (actual)	20,000
August (actual)	26,000
September (actual)	40,000
October (budget)	70,000
November (budget)	110,000
December (budget)	60,000
January (budget)	30,000
February (budget)	28,000
March(budget)	25,000

The concentration of sales in the fourth quarter is due to theChristmas holiday. Sufficient inventory should be on hand at theend of each month to supply 40% of the bracelets sold in thefollowing month.

Suppliers are paid $4 for each bracelet. Fifty-percent of amonth's purchases is paid for in the month of purchase; the other50% is paid for in the following month. All sales are on creditwith no discounts. The company has found, however, that only 20% ofa month's sales are collected in the month of sale. An additional70% is collected in the following month, and the remaining 10% iscollected in the second month following sale. Bad debts have beennegligible.

Monthly operating expenses for the company are given below:

Variable expenses:

Salescommissions 4% of sales

Fixed expenses:

Advertising $220,000

Rent $20,000

Salaries $110,000

Utilities $10,000

Insurance $5,000

Depreciation $18,000

Insurance is paid on an annual basis, in January of eachyear.

The company plans to purchase $22,000 in new equipment duringOctober and $50,000 in new equipment during November; bothpurchases will be for cash. The company declares dividends of$20,000 each quarter, payable in the first month of the followingquarter.

Other relevant data is given below:

Cash balance as of September 30 $74,000

Inventory balance as of September30 $112,000

Merchandise purchases forSeptember $200,000

The company maintains a minimum cash balance of at least $50,000at the end of each month. All borrowing is done at the beginning ofa month; any repayments are made at the end of a month.

The company has an agreement with a bank that allows the companyto borrow the exact amount needed at the beginning of each month.The interest rate on these loans is 1% per month and for simplicitywe will assume that interest is not compounded. At the end of thequarter, the company will pay the bank all of the accrued intereston the loan and as much of the loan as possible while stillretaining at least $50,000 in cash.

Required:

Prepare a cash budget for the three-month period ending December31. Include the following detailed budgets:

a. A sales budget, by monthand in total.

b. A schedule of expectedcash collections from sales, by month and in total.

c. A merchandise purchasesbudget in units and in dollars. Show the budget by month and intotal.

d. A schedule of expectedcash disbursements for merchandise purchases, by month and intotal.

2. A cash budget. Show the budget bymonth and in total. Determine any borrowing that would be needed tomaintain the minimum cash balance of $50,000.

BUDGETED CASHDISBURSEMENTS FOR MERCHANDISE PURCHASES:
	October	November	December	Quarter
September purchases
October purchases
November purchases
December purchases
Total cash payments

skyhornet436

This is my fifth and final time... Can someone please provide methe FORMULAS, ANSWERS, AND QUARTER TOTALS FOR THIS SECTION... IT'SNOT THAT HARD TO COMPREHEND.. PLEASE I NEED IT ASAP!!!

Need the Quarter calculations also in this section.... It wasnot provided to me the last three times that I requested it!!