Flexible Actual Spending Budget Results Variances Units sold(q) 30,000 30,000 Expenses: Advertising ($200,000) $200,000 $210,000 $10,000 U Sales salaries and commissions ($100,000 + $12.00q) $460,000 $455,000 $5,000 F Shipping expenses ($3.00q) $90,000 $115,000 $25,000 U Exercise 8-3 (15 minutes) Tours Planning Budget For the Month Ended August 31 Budgeted cruises (q1) 58 Budgeted passengers (q2) 3,200 Revenue ($28.00q2) $89,600 Expenses: Vessel operating costs ($6,800 + $475.00q1 +$3.50q2) 45,550 Advertising ($2,700) 2,700 Administrative ($5,800 + $36.00q1 + $1.80q2) 13,648 Insurance ($3,600) 3,600 Total expense 65,498 Net operating income $24,102 Exercise 8-13 (20 minutes) 1. Standard Quantity Allowed Actual Quantity of Actual Quantity of for Actual Output, Input, Input, at Standard Price at Standard Price at Actual Price (SQ × SP) (AQ × SP) (AQ × AP) 18,000 ounces* × 20,000 ounces × 20,000 ounces × $2.50 per $2.50 per ounce $2.40 per ounce = $45,000 = $50,000 = $48,000 Materials quantity variance Materials = $5,000 U variance = $2,000 F
Flexible Budget Actual Results Spending Variances Units sold(q) 30,000 30,000 Expenses: Advertising ($200,000) $200,000 $210,000 $10,000 U Sales salaries and commissions ($100,000 + $12.00q) $460,000 $455,000 $5,000 F Shipping expenses ($3.00q) $90,000 $115,000 $25,000 U Exercise 8-3 (15 minutes) Tours Planning Budget For the Month Ended August 31 Budgeted cruises (q1) 58 Budgeted passengers (q2) 3,200 Revenue ($28.00q2) $89,600 Expenses: Vessel operating costs ($6,800 + $475.00q1 +$3.50q2) 45,550 Advertising ($2,700) 2,700 Administrative ($5,800 + $36.00q1 + $1.80q2) 13,648 Insurance ($3,600) 3,600 Total expense 65,498 Net operating income $24,102 Exercise 8-13 (20 minutes) 1. Standard Quantity Allowed for Actual Output, at Standard Price (SQ × SP) Actual Quantity of Input, at Standard Price (AQ × SP) Actual Quantity of Input, at Actual Price (AQ × AP) 18,000 ounces* × $2.50 per = $45,000 20,000 ounces × $2.50 per ounce = $50,000 20,000 ounces × $2.40 per ounce = $48,000 Materials quantity variance = $5,000 U Materials variance = $2,000 F
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