Exercise 24-18 The Dinkle and Frizell Dental Clinic provides both preventive and orthodontic dental services. The two owners, Reese Dinkle and Anita Frizell, operate the clinic as two separate investment centers: Preventive Services and Orthodontic Services. Each of them is in charge of one of the centers: Reese for Preventive Services and Anita for Orthodontic Services. Each month, they prepare an income statement for the two centers to evaluate performance and make decisions about how to improve the operational efficiency and profitability of the clinic. Recently, they have been concerned about the profitability of the Preventive Services operations. For several months, it has been reporting a loss. The responsibility report for the month of May 2017 is shown below. Difference Actual from Budget Service revenue $40,000 $1,000 Favorable Variable costs: Filling materials 5,000 100 Unfavorable Novocain 3,900 100 Unfavorable Supplies 1,900 350 Favorable Dental assistant wages 2.500 -- Neither Favorable nor Unfavorable Utilities 500 110 Unfavorable Total variable costs 13,800 40 Favorable Fixed costs: Allocated portion of receptionist's salary 3,000 200 Unfavorable Dentist salary 9,800 400 Unfavorable Equipment depreciation 6,000 -0-Neither Favorable nor Unfavorable Allocated portion of building depreciation 15,000 1,000 Unfavorable Total fixed costs 33,800 1,600 Unfavorable Operating income (loss) 5(7,500) 5560 Unfavorable In addition, the owners know that the investment in operating assets at the beginning of the month was $82,400, and it was 577,600 at the end of the month. They have asked for your assistance in evaluating their current performance reporting system. Prepare a responsibility report for an investment center as illustrated in the chapter. (Round ROI to 1 decimal place, e.g. 1.5.) DINKLE AND FRIZELL DENTAL CLINIC Preventive Services Responsibility Report For the Month Ended May 31, 2017 Difference Favorable F Unfavorable U Neither Favorable nor Unfavorable N Budget Actual V SOGEDEED V Return on investment $1 - Contribution Margin Controllable Fixed Costs Controllable Margin Dental Assistant Wages Dentist Salary Equipment Depreciation Filling Materials Gross Profit Novocain Other Fixed Costs Service Revenue Supplies Total Controllable Fixed Costs Total Variable Costs Utilities Variable Costs Allocated Portion of Receptionist's Salary Allocated Portion of Building Depreciation O