ASSIGNMENT- Homework 1 Northwest Table manufactures tables for use in business offices. The March 2019 condensed flexible budget shows output levels of 650, 800, & 1,000 units. The static budget was based on expected sales of 800 units. (condensed, so no details about variable for DM,DL,MO, Sell/ Admin or details of Fixed cost) Northwest Table Inc. Flexible Budget For the Month Ended March 31, 2019 Budget Amount Units Per Unit 650 800 1,000 Sales Revenue Total Variable Costs $23.00 14.00 $14,950 $ 18,400 $23,000 9.100 11.200 14,000 Contribution Margin 5,850 7,200 9,000 Total Fixed Costs 5,600 5,600 5,600 Operating Income 250 1,600 3,400 The company sold 1,000 units during March, and its actual operating income is shown: Northwest Table Inc. Income Statement For the Month Ended March 31, 2019 Sales Revenue Total Variable Costs Contribution Margin Total Fixed Costs Operating Income $ 23,700 14,510 9,190 5,700 3,490 Requirement 1 - Prepare a flexible budget performance report for March Northwest Flag Inc. Flexible Budget Performance Report For the Month Ended March 31, 2019 Units Actual Flexible Budget Amount Results Per Unit 1,000 Budget 1,000 Static Budget 800 $23.00 S F S 23,000 1. FS 18,400 14.00 14,510 2.. F 1,800 F 3,490 100 U 90 F 3,400 1,600 Flexible Budget Var. Sales Volume Var. Static Budget Var. Sales Revenue Total Variable Costs Contribution Margin Total Fixed Costs Operating Income Requirement 2-What was the effect on the company's operating income of selling 200 units more than the static budget level of sales? Increase... or...Decrease S Requirement 3 - What was the company's static budget variance $ 3. operating income is higher than expected per the static budget. F meaning that its Requirement 4-What additional information does the performance report provide to managers other than the simple static budget? Do these variances suggest that marketing department did a good...or poor job? They sold more units than expected and sold them at a higher price. Homework 2 Texas Boat Covers, Inc. which uses a standard cost accounting system, manufactured 2,000 boat covers during 2014, using 14,400 square feet of vinyl purchased at $1.05 per square foot. Production required 42 direct labor hours that cost $13.50 per hour. The direct labor standard was 0.025 direct labor hour per cover, at a standard cost of $12.50. The direct materials standard was 7 square feet of vinyl per cover, at a standard cost of $1.10 per square foot. You have what you need: standards and actual are given in the paragraph Requirement 1-Compute the cost and efficiency variances for direct materials and direct labor. Begin the cost variances for each. Select the "shortcut" formula and compute. (Note: you can use the "shortcut" formula or the regular formula to compute the variance) Direct materials cost variance = (AC-SC) x AQ = (1.05-1.10) x 14,400 sq. ft = 720 F Direct labor cost variance = (AC-SC) x AQ Next, compute the efficiency variance for each. Select the "shortcut" formula and compute. (Note: you can use the "shortcut" formula or the regular formula to compute the variance) Direct materials efficiency variance - (AQ-SQ) x SC Direct labor efficiency variance = (AQ-SQ) x SC -100 F Requirement 2-Now, take a few minutes and consider what this information tells managers about operations