Comprehensive Performance Report

Instant Computing is a contract manufacturer of laptop computers sold under brand named companies.

Presented are Instants budgeted and actual contribution income statements for October. The company

has three responsibility centers: Production, Selling and Distribution, and Administration. Production

and Administration are cost centers while Selling and Distribution is a profit center.

INSTANT COMPUTING Budgeted Contribution Income Statement For Month of October $800,000 $120,000 80,000 40,000 $240,000 Sales (2,000 $400) Less variable costs Variable cost of goods sold Direct materials (2,000 x $60). Direct labor (2,000 x $40). Manufacturing overhead (2,000 x $20). Selling and Distribution (2,000 x $45). Contribution margin ... Less fixed costs Manufacturing overhead. Administrative Selling and Distribution. 90,000 (330,000) 470,000 160,000 125,000 75,000 (360,000) $110,000 Net income INSTANT COMPUTING Actual Contribution Income Statement For Month of October $866,250 $139,500 85,500 43.875 Sales (2,250 $385) Less variable costs Cost of goods sold Direct materials Direct labor Manufacturing overhead Selling and Distribution Contribution margin Less fixed costs Manufacturing overhead. Administrative Selling and Distribution. Net income (loss). $268,875 105,750 (374,625) 491,625 168,000 135,000 74,600 (377,600) $114,025 Required a. Prepare a performance report for Production that compares actual and allowed costs. b. Prepare a performance report for Selling and Distribution that compares actual and allowed costs. c. Determine the sales price and the net sales volume variances. d. Prepare a report that summarizes the performance of Selling and Distribution. e. Determine the amount by which Administration was over or under budget. f. Prepare a report reconciling budgeted and actual net income. Your report should focus on the performance of each responsibility center