Three Budgeting questions

Exercise 1
The
following data are the actual results for Marvelous Marshmallow Company for
August.
Actual
output
………………………………………………………………………………………………….13,500
cases
Actual
variable overhead
………………………………………………………………………….
$607,500
Actual
fixed overhead
………………………………………………………………………………
$183,000
Actual
machine time ………………………………………………………………………….60,750
machine hours
Standard
cost and budget information for Marvelous Marshmallow Company follows:
Standard
variable-overhead rate………………………………………… 9.00 per
machine hour
Standard
quantity of machine hours …………………………………..4 hours per
case of marshmallows
Budgeted
fixed overhead……………………………………………….. $180,000
per month
Budgeted
output ……………………………………………………………15,000
cases per month

Required:Build a spreadsheet:Construct an Excel spreadsheet to solve the
preceding requirement. Show how the solution will change if the following
information changes: actual output was 13,350 cases, and actual variable
overhead was $609,000.

Exercise 2.
The
controller for Rainbow Children’s Hospital, located in Munich, Germany,
estimates that the hospital uses 25 kilowatt-hours of electricity per
patient-day, and that the electric rate will be €.13 per kilowatt-hour. The
hospital also pays a fixed monthly charge of €2,000 to the electric utility to
rent emergency backup electric generators. *

Required:Construct a flexible budget for the hospital’s
electricity costs using each of the following techniques.
1.
Formula flexible budget.
2.
Columnar flexible budget for 30,000, 40,000, and 50,000 patient-days of
activity. List variable and fixed electricity costs separately.

Exercise 3
LakeMaster
Company manufactures outboard motors that are sold throughout the United States
and Canada. The company uses a comprehensive budgeting process and compares
actual results to budgeted amounts on a monthly basis. Each month, LakeMaster’s
accounting department prepares a variance analysis and distributes the report
to all responsible parties. Al Richmond, production manager, is upset about the
results for June. Richmond, who is responsible for the cost of goods
manufactured, has implemented several cost-cutting measures in the
manufacturing area and is discouraged by the unfavorable variance in variable
costs.

When
the master budget was prepared, LakeMaster’s cost accountant, Joan Ballard,
supplied the following unit costs: direct material, $90; direct labor, $66;
variable overhead, $54; and variable selling, $18.
The
total variable costs of $1,170,000 for June include $480,000 for direct
material, $288,000 for direct labor, $264,000 for variable overhead, and
$138,000 for variable selling expenses. Ballard believes that monthly reports
would be more meaningful to everyone if the company adopted flexible budgeting
and prepared more detailed analyses.

Required:
1.
Prepare a flexible budget for LakeMaster Company for the month of June that
includes separate variable-cost budgets for each type of cost (direct material,
etc.).
2.
Determine the variance between the flexible budget and actual cost for each
cost item.
3.
Discuss how the revised budget and variance data are likely to impact the
behavior of Al Richmond, the production manager.
4. Construct an
Excel spreadsheetto
solve requirements (1) and (2) above. Show how the solution will change if the
following information changes: actual sales amounted to 4,700 units and actual
fixed overhead was $272,000.

Place your order
(550 words)

Approximate price: $22

Calculate the price of your order

550 words
We'll send you the first draft for approval by September 11, 2018 at 10:52 AM
Total price:
$26
The price is based on these factors:
Academic level
Number of pages
Urgency
Basic features
  • Free title page and bibliography
  • Unlimited revisions
  • Plagiarism-free guarantee
  • Money-back guarantee
  • 24/7 support
On-demand options
  • Writer’s samples
  • Part-by-part delivery
  • Overnight delivery
  • Copies of used sources
  • Expert Proofreading
Paper format
  • 275 words per page
  • 12 pt Arial/Times New Roman
  • Double line spacing
  • Any citation style (APA, MLA, Chicago/Turabian, Harvard)

Our guarantees

Delivering a high-quality product at a reasonable price is not enough anymore.
That’s why we have developed 5 beneficial guarantees that will make your experience with our service enjoyable, easy, and safe.

Money-back guarantee

You have to be 100% sure of the quality of your product to give a money-back guarantee. This describes us perfectly. Make sure that this guarantee is totally transparent.

Read more

Zero-plagiarism guarantee

Each paper is composed from scratch, according to your instructions. It is then checked by our plagiarism-detection software. There is no gap where plagiarism could squeeze in.

Read more

Free-revision policy

Thanks to our free revisions, there is no way for you to be unsatisfied. We will work on your paper until you are completely happy with the result.

Read more

Privacy policy

Your email is safe, as we store it according to international data protection rules. Your bank details are secure, as we use only reliable payment systems.

Read more

Fair-cooperation guarantee

By sending us your money, you buy the service we provide. Check out our terms and conditions if you prefer business talks to be laid out in official language.

Read more