Pronto Plumbing Company is a newly formed company that specializes in plumbing services for home and business. The owner, Paul Pronto, had divided the company into two segments: home plumbing services and business plumbing services. Each segment is run by its own supervisor, while both segments share basic selling and administrative duties.
Paul has asked you to help him create a performance reporting system that will allow him to measure each segment's performance in terms of its profitability. The following information has been collected on the home plumbing services segment for the first quarter of 2016:

Instructions
(a) Prepare a responsibility report for the first quarter of 2016 for the home plumbing services segment.
(b) Write a memo to Paul Pronto in which you discuss the principles that he should use when preparing performance reports.

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Budget $30,000 Actual $31,500 Service revenue Allocated portion of costs 11,000 5,000 3,500 1,200 1,500 10,000 4,000 4,000 2,700 1,600 Building depreciation Advertising Billing Property taxes 11,000 4,200 3,000 1,000 1,300 10,500 3,300 4,200 3,400 1,300 Materials and supplies Supervisory salaries Insurance Gas and oil