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Time 2 Kool installed ten pools during March. Prepare an income statement performance report for Time 2 Kool for March, using the table below as a guide. (Click the icon to view the table.) Assume that the actual sales price per pool is $13,200, actual variable expenses total $65,500, and actual fixed expenses are $19,400 in March. The master budget was prepared with the following assumptions: variable cost of $8,000 per pool, fixed expenses of $20,200 per month, and anticipated sales volume of nine pools at $13,200 per pool. Requirement 1. Compute the sales volume variance and flexible budget variance. Use these variances to explain to Time 2 Kool's management why March's operating income differs from operating income shown in the static budget. Requirement 1. Compute the sales volume variance and flexible budget variance. Use these variances to explain to Time 2 Kool's management why March's operating income differs from operating income shown in the static budget Prepare an income statement report for Time 2 Kool for March. (For accounts with a zero balance, make sure to enter "0" in the appropriate column. Label each variance as favourable (F) or unfavourable (U). If the variance is zero, do not select a label.) Time 2 Kool Pools Income Statement Performance Report Month Ended March 3 Flexible Budget for Actual Results at Flexible Budget Actual Number of Sales Volume Static (Master) Actual Prices Variance Output Units Variance Budget Output units Sales revenue Variable expenses Fixed expenses Total expenses Operating income Use the sales volume variance and flexible budget variance to explain to Time 2 Kool's management why March's operating income differs from operating income shown in the static budget Time 2 Kool's actual operating income was $ the static budget. There are two primary reasons: 1. Time 2 Kool actually installed pool than expected. This operating income by $. 2. Time 2 Kool's actual expenses to install 10 pools were $ than they should have been to install 10 pools. This flexible budget variance means that Time 2 Kool did a job controlling cost.Time 2 Kool installed ten pools during March. Prepare an income statement performance report for Time 2 Kool for March, using the table below as a guide. (Click the icon to view the table.) Assume that the actual sales price per pool is $13,200, actual variable expenses total $65,500, and actual fixed expenses are $19,400 in March. The master budget was prepared with the following assumptions: variable cost of $8,000 per pool, fixed expenses of $20,200 per month, and anticipated sales volume of nine pools at $13,200 per pool. Requirement 1. Compute the sales volume variance and flexible budget variance. Use these variances to explain to Time 2 Kool's management why March's operating income differs from operating income shown in the static budget. Requirement 1. Compute the sales volume variance and flexible budget variance. Use these variances to explain to Time 2 Kool's management why March's operating income differs from operating income shown in the static budget. Prepare an income statement report for Time 2 Kool for March. (For accounts with a zero balance, make sure to enter "0" in the appropriate column. Label each variance as favourable (F) or unfavourable (U). If the variance is zero, do not select a label.) Time 2 Kool Pools Income Statement Performance Report Month Ended March 3 Flexible Budget for Actual Results at Flexible Budget Actual Number of Sales Volume Static (Master) Output units i Data Table X Sales revenue Variable expe Fixed expense Time 2 Kool Pools Income Statement Performance Report Total expense Month Ended June 30 Operating inc (1) (2) (3) (4) (5) Use the sales (1)-(3) Flexible (3) -(5) ers from operating income shown in the static budget. Actual Budget Time 2 Kool's Results Flexible or Actual Sales Static at Actual Budget Number of Volume (Master) 1. Time 2 Ko Prices Variance Output Units* Variance Budget* 2. Time 2 Koo 10 -0- 10 2F Output units (pools installed) 8 flexible budget variance means that Time 2 Kool d Sales revenue $121,000 $1,000 F $120,000 $24,000 F $96,000 Variable expenses 83,000 3,000 U 30,000 16,000 64,000 Fixed expenses 22,000 2,000 U 20,000 -0- 20,00 Total expenses 105,000 5,000 U 100,000 6,000 84,000 $4,000 U Operating income $ 16,000 $ 20,000 $ 8,000 F $12,000 Flexible budget variance, Sales volume variance $4,000 U $8,000 F Static budget variance, $4,000 F * Budgeted sale price is $12,000 per pool, budgeted variable expense is $8,000 per pool, and budgeted total monthly fixed expenses are $20,000. Print Done
