Question
Quilcene Oysteria farms and sells oysters in the Pacific Northwest. The company harvested and sold 7,700 pounds of oysters in August. The companys flexible budget
| Quilcene Oysteria farms and sells oysters in the Pacific Northwest. The company harvested and sold 7,700 pounds of oysters in August. The companys flexible budget for August appears below: |
| Quilcene Oysteria Flexible Budget For the Month Ended August 31 | ||
| Actual pounds (q) | 7,700 | |
| Revenue ($4.20q) | $ | 32,340 |
| Expenses: | ||
| Packing supplies ($0.25q) | 1,925 | |
| Oyster bed maintenance ($3,400) | 3,400 | |
| Wages and salaries ($2,300 + $0.45q) | 5,765 | |
| Shipping ($0.70q) | 5,390 | |
| Utilities ($1,300) | 1,300 | |
| Other ($440 + $0.01q) | 517 | |
| Total expense | 18,297 | |
| Net operating income | $ | 14,043 |
| The actual results for August appear below: |
| Quilcene Oysteria Income Statement For the Month Ended August 31 | ||
| Actual pounds | 7,700 | |
| Revenue | $ | 26,600 |
| Expenses: | ||
| Packing supplies | 2,095 | |
| Oyster bed maintenance | 3,260 | |
| Wages and salaries | 6,175 | |
| Shipping | 5,120 | |
| Utilities | 1,110 | |
| Other | 1,137 | |
| Total expense | 18,897 | |
| Net operating income | $ | 7,703 |
| Required: | |
| Compute the companys revenue and spending variances for August. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) | |
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Income Tax Fundamentals 2013
Authors: Gerald E. Whittenburg, Martha Altus Buller, Steven L Gill
31st Edition
9781285586618
