Budget Performance Report for a Cost Center

Haliburton Company sells vehicle parts to manufacturers of heavy construction equipment. The Grader Division is organized as a cost center. The budget for the Grader Division for the month ended August 31, 20Y6, is as follows (in thousands):

Line Item Description	Amount
Customer service salaries	$ 437,500
Insurance and property taxes	87,500
Distribution salaries	831,250
Marketing salaries	525,000
Engineer salaries	1,295,000
Warehouse wages	490,000
Equipment depreciation	271,250
Total	$ 3,937,500

During August, the costs incurred in the Grader Division were as follows:

Line Item Description	Amount
Customer service salaries	$ 607,200
Insurance and property taxes	81,015
Distribution salaries	774,675
Marketing salaries	612,150
Engineer salaries	1,218,113
Warehouse wages	453,585
Equipment depreciation	255,750
Total	$ 4,002,488

Required:

Question Content Area

 

1.  Prepare a budget performance report for the director of the Grader Division for the month of August. Enter amounts in thousands (same format as the data above).

If an amount box does not require an entry, leave it blank. Use a negative sign to indicate budget deficits.

Line Item Description	Budget	Actual	Over Budget	(Under) Budget
Customer service salaries	$Customer service salaries	$Customer service salaries	$Customer service salaries	$Customer service salaries
Insurance and property taxes	Insurance and property taxes	Insurance and property taxes	Insurance and property taxes	Insurance and property taxes
Distribution salaries	Distribution salaries	Distribution salaries	Distribution salaries	Distribution salaries
Marketing salaries	Marketing salaries	Marketing salaries	Marketing salaries	Marketing salaries
Engineer salaries	Engineer salaries	Engineer salaries	Engineer salaries	Engineer salaries
Warehouse wages	Warehouse wages	Warehouse wages	Warehouse wages	Warehouse wages
Equipment depreciation	Equipment depreciation	Equipment depreciation	Equipment depreciation	Equipment depreciation
Total	$fill in the blank c909db075029fe1_29	$fill in the blank c909db075029fe1_30	$fill in the blank c909db075029fe1_31	$fill in the blank c909db075029fe1_32

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Feedback

 

 

Calculate the difference between the budget and actual amounts, and determine whether the actual amount is over or under the budget amounts.

 

 

 

 

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2.  Given the data, all of the following could explain the over-budget areas except:
 

unplanned efforts to market the company's products.an increase in service problems.unplanned bonuses in marketing and customer service salaries.an increase in distribution labor hours.an increase in distribution labor hours.