XYZ Company's budgeted and actual results for last year are asfollows:
Master budget Actual results Price $450 $650 Sales volume (units) 8,000 6,500 Unit VC $200 $200 Fixed costs $200,000 $200,000
Required:
(a) Compute budgeted and actual revenue, costs and profits:
Master budget Actual Sales volume (units) Revenue $ $ Variable costs $ $ Contribution margin $ $ Fixed costs $ $ Profit $ $
In (b)-(d) below, enter favorable and unfavorable variances aspositive and negative numbers, without F or U.
(b) How much is the total profit variance?
(enter negative numbers with a minus, i.e. enter negative $100as -100 not ($100) ) $
(c) How much is the activity variance(=sales volumevariance)?
(enter negative numbers with a minus) $
(d) How much is the revenue variance (=sales price variance)?
(enter negative numbers with a minus) $
XYZ Company's budgeted and actual results for last year are asfollows:
| Master budget | Actual results | |
| Price | $450 | $650 |
| Sales volume (units) | 8,000 | 6,500 |
| Unit VC | $200 | $200 |
| Fixed costs | $200,000 | $200,000 |
Required:
(a) Compute budgeted and actual revenue, costs and profits:
| Master budget | Actual | |
| Sales volume (units) | ||
| Revenue | $ | $ |
| Variable costs | $ | $ |
| Contribution margin | $ | $ |
| Fixed costs | $ | $ |
| Profit | $ | $ |
In (b)-(d) below, enter favorable and unfavorable variances aspositive and negative numbers, without F or U.
(b) How much is the total profit variance?
(enter negative numbers with a minus, i.e. enter negative $100as -100 not ($100) ) $
(c) How much is the activity variance(=sales volumevariance)?
(enter negative numbers with a minus) $
(d) How much is the revenue variance (=sales price variance)?
(enter negative numbers with a minus) $
Related questions
Question 1. (total profit variance, salesprice and sales quantity variance)
XYZ Company's budgeted and actual results for last year are asfollows:
| Master budget | Actual results | |
| Price | $500 | $600 |
| Sales volume (units) | 5,000 | 3,500 |
| Unit VC | $150 | $150 |
| Fixed costs | $350,000 | $350,000 |
Required:
(a) Compute budgeted and actual revenue, costs and profits:
| Master budget | Actual | |
| Sales volume (units) | ||
| Revenue | $ | $ |
| Variable costs | $ | $ |
| Contribution margin | $ | $ |
| Fixed costs | $ | $ |
| Profit | $ | $ |
In (b)-(d) below, enter favorable and unfavorable variances aspositive and negative numbers, without F or U.
(b) How much is the total profit variance?
(enter negative numbers with a minus, i.e. enter negative $100as -100 not ($100) ) $
(c) How much is the sales volume variance?
(enter negative numbers with a minus) $
(d) How much is the sales price variance?
(enter negative numbers with a minus) $
Problem 16-46 Solve for Master Budget Given Actual Results (LO16-2, 4)
A new accounting intern at Gibson Corporation lost the only copyof this period's master budget. The CFO wants to evaluateperformance for this period but needs the master budget to do so.Actual results for the period follow:
| Sales volume | 130,000 | units | |
| Sales revenue | $ | 873,600 | |
| Variable costs | |||
| Manufacturing | 192,192 | ||
| Marketing andadministrative | 78,624 | ||
| Contribution margin | $ | 602,784 | |
| Fixed costs | |||
| Manufacturing | 251,200 | ||
| Marketing andadministrative | 146,000 | ||
| Operating profit | $ | 205,584 | |
The company planned to produce and sell 110,500 units for $6.00each. At that volume, the contribution margin would have been$464,100. Variable marketing and administrative costs are budgetedat 10 percent of sales revenue. Manufacturing fixed costs areestimated at $2.40 per unit at the normal volume of 110,500 units.Management notes, "We budget an operating profit of $1.00 per unitat the normal volume."
Required:
a. Construct the master budget for the period.(Do not round intermediate calculations.)
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b. Prepare a profit variance analysis.(Do not round intermediate calculations. Indicate theeffect of each variance by selecting "F" for favorable, or "U" forunfavorable. If there is no effect, do not select eitheroption.)
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Harris Miniature Sports Cars makes popular high quality models of expensive cars, such as the Maserati. Master budget data and actual results for the most recent quarter of operations are as follows:
| Master Budget | Actual results | |
| Sales (# of cars) | 15,000 | 12,000 |
| Revenues | $375,000 | $300,000 |
| Variable costs | 75,000 | 54,000 |
| Fixed costs | 150,000 | 141,000 |
| Profit | $150,000 | $105,000 |
Mr. Harris is alarmed that actual revenue decreased by 20% and more importantly, that the actual profit decreased by 30% compared to the master budget. Because of these numbers, the owner is convinced that both marketing director and the production manager did not do a good job last quarter.
1. Compute Harrisâs flexible budget for the most recent quarter of operations.
2. Calculate Harrisâs sales volume and sales price variances for the month.
3. What were Harrisâs variable cost and fixed cost variances for the most recent quarter?
4. In light of your answers to the variance calculations, who do you believe is responsible for the poor profit performance last quarter?
