Managerial Accounting Chapter 9 Exrcise 9-11

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EXHIBIT 9-11 Performance Report With More Than One Cost Driver That Combines Activity Variances with Revenue and Spending Variances Rick's Hairstyling Flexible Budget Performance Report For the Month Ended March 31 Actual Results Revenue and Spending Variances Flexible Budget Activity Variances Planning Budget Client-visits (4) 1,100 1,100 1,000 190 190 190 Hours of operation (9) Revenue ($180.000) $194,200 $ 3,800 U $198.000 $ 18,000 F $ 180,000 106,900 100 U 106,800 0 106,800 1,620 30 F 1,650 150 U 1,500 6,870 2,360 U 4,510 410 U 4,100 Expenses: Wages and salaries ($65,000+ $220.004) Hairstyling supplies ($1.504) Client gratuities ($4.100) Electricity ($390 + $0.100, + $6.0042) Rent ($28,500) Liability insurance ($2,800) Employee health insurance ($21,300) Miscellaneous ($1,200 + $0.2004) 90 F 1,640 10 U 1,630 1,550 28,500 0 28,500 0 28,500 2,800 2,800 0 2,800 0 22,600 1,300 U 21,300 0 21,300 710 U 1,420 20 U 1,400 Total expense 2,130 172.970 $ 21,230 4,350 U 590 U 168,030 168,620 $ 29,380 Net operating income $ 8,150 U $ 17,410 F $ 11,970 EXHIBIT 9-11 Performance Report With More Than One Cost Driver That Combines Activity Variances with Revenue and Spending Variances Rick's Hairstyling Flexible Budget Performance Report For the Month Ended March 31 Actual Results Revenue and Spending Variances Flexible Budget Activity Variances Planning Budget Client-visits (4) 1,100 1,100 1,000 190 190 190 Hours of operation (9) Revenue ($180.000) $194,200 $ 3,800 U $198.000 $ 18,000 F $ 180,000 106,900 100 U 106,800 0 106,800 1,620 30 F 1,650 150 U 1,500 6,870 2,360 U 4,510 410 U 4,100 Expenses: Wages and salaries ($65,000+ $220.004) Hairstyling supplies ($1.504) Client gratuities ($4.100) Electricity ($390 + $0.100, + $6.0042) Rent ($28,500) Liability insurance ($2,800) Employee health insurance ($21,300) Miscellaneous ($1,200 + $0.2004) 90 F 1,640 10 U 1,630 1,550 28,500 0 28,500 0 28,500 2,800 2,800 0 2,800 0 22,600 1,300 U 21,300 0 21,300 710 U 1,420 20 U 1,400 Total expense 2,130 172.970 $ 21,230 4,350 U 590 U 168,030 168,620 $ 29,380 Net operating income $ 8,150 U $ 17,410 F $ 11,970