Prepare performance reports for various organizational levels (Learning Objectives 1, 5)

Winnie’s World operates a chain of pet stores in the Midwest. The manager of each store reports to the region manager, who, in turn, reports to the headquarters in Milwaukee, Wisconsin. The actual income statements for the Dayton store, the Ohio region (including the Dayton store), and the company as a whole (including the Ohio region) for July 2009 are:

Budgeted amounts for July were as follows:

Requirements 1. Prepare a report for July 2009 that shows the performance of the Dayton store, the Ohio region, and the company as a whole. Follow the format of Exhibit 10-20.
2. As the Ohio region manager, would you investigate the Dayton store on the basis of this report? Why or why not?
3. Briefly discuss the benefits of budgeting. Base your discussion on Winnie’s World’s performance report.

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Dayton Ohio Company-Wide Region manager/ Revenue... Expenses: $148,900 $1,647,000 $4,200,000 headquarters office...... $ - $ 60,000 $ 116,000 Cost of materials........... 81,100 871,900 1,807,000 Salary expense......... 38,300 415,100 1,119,000 Depreciation expense.... 7,200 91,000 435,000 Utilities expense. 4,000 46,200 260,000 Rent expense. 2,400 34,700 178,000 Total expenses... 133,000 1,518,900 3,915,000 Operating income........... $ 15,900 $ 128,100 $ 285,000