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The Lasting Balloon Company produces party balloons that are sold in multi-pack cases. To follow is the company's performance report in contribution margin format for October Click the icon to view the performance report in contribution margin format.) Read the requirements Requirement 1. What is the budgeted sales price per unit? The budgeted sales price per unit is * Requirements 1. What is the budgeted sales price per unit? 2. What is the budgeted variable expense per unit? 3. What is the budgeted fixed cost for the period? 4. Compute the master budget variances. Be sure to indicate each variance as favorable (F) or unfavorable (U.) 5. Management would like to determine the portion of the master budget variance that is (a) due to volume being different than originally anticipated and (b) due to some other unexpected cause. Prepare a flexible budget performance report to address these questions, using the actual sales volume of 58,000 units and the budgeted sales volume of 56,000 units. Use the original budget assumptions for sales price, variable cost per unit, and fixed costs, assuming the relevant range stretches from 51,000 to 68,000 units 6. Using the flexible budget performance report you prepared for Requirement 5, answer the following questions: How much of the master budget variance (calculated in Requirement 4) for operating income is due to volume being higher than expected? How much of the master budget variance for variable expenses is due to some cause other than volume? What could account for the flexible budget variance for sales revenue? What is the volume variance for fixed expenses? Why is it this amount? a. b C. d. Print Done mts Data Table ud ud A B D ud 1 ma 2. (U) The Lasting Balloon Company Actual vs. Budget Performance Report For the Month Ended October 31 two 3 nt to get e bu lec . exibl Master Budget Variance Master Actual Budget 5 Sales volume (number of cases sold) 58,000 56,000 6 Sales revenue $ 176,200 $ 151,200 7 Less: Variable expenses 85,300 72,800 8 Contribution margin $ 90,900 $ 78,400 9 Less: Fixed expenses 74,800 73,000 $ 16,100 $ 5,400 10 Operating income much volu much e? could is the Print Done Canon Industries has gathered the following information about the actual sales revenues and expenses for its pharmaceuticals segment for the most recent year. Click the icon to view the actual data.) Budgeted data for the same time period for the pharmaceutical segment are as follows (all data are in millions): Click the icon to view the budgeted data.) Prepare a segment margin performance report for the pharmaceutical segment. Calculate a variance and a variance percentage for each line in the report. Round to the nearest hundredth for the variance percentages (for example, if your answer is 16.2384%, round it to 16.24%). Begin by preparing the performance report through the contribution margin line. Next, complete the report through the segment margin line, and then, finally, complete the report through the operating income line. (Enter the variances as positive numbers. Round the variance percentages to the nearest hundredth percent, XXX%.) Performance Report Canon - Pharmaceutical Segment For Fiscal Year Ending December 31 Actual Bugeted Variance Variance % % Sales Less Variable Expenses: Variable Cost of Goods Sold Variable Operating Expenses Contribution Margin % % Performance Report Canon - Pharmaceutical Segment For Fiscal Year Ending December 31 Actual Bugeted Variance Varianc Data Table es Sales $ 806,400 $ 237,600 $ 130,950 Variable Cost of Goods Sold Variable Operating Expenses Direct Fixed Manufacturing Overhead Direct Fixed Operating Expenses Common Fixed Expenses $ 98,100 31,200 ..... $ 23,320 Print Done % per of i Data Table atii on 9,000 80 24 Budgeted sales in units Budgeted average selling price per unit $ Variable Cost of Goods Sold per unit Variable Operating Expenses per unit $ Direct Fixed Manufacturing Overhead (in total) $ Direct Fixed Operating Expenses (in total) $ Common Fixed Expenses Allocated to the Pharmaceutical Segment $ 15 -- 90,000 30,000 22.000 Print Done The Lasting Balloon Company produces party balloons that are sold in multi-pack cases. To follow is the company's performance report in contribution margin format for October Click the icon to view the performance report in contribution margin format.) Read the requirements Requirement 1. What is the budgeted sales price per unit? The budgeted sales price per unit is * Requirements 1. What is the budgeted sales price per unit? 2. What is the budgeted variable expense per unit? 3. What is the budgeted fixed cost for the period? 4. Compute the master budget variances. Be sure to indicate each variance as favorable (F) or unfavorable (U.) 5. Management would like to determine the portion of the master budget variance that is (a) due to volume being different than originally anticipated and (b) due to some other unexpected cause. Prepare a flexible budget performance report to address these questions, using the actual sales volume of 58,000 units and the budgeted sales volume of 56,000 units. Use the original budget assumptions for sales price, variable cost per unit, and fixed costs, assuming the relevant range stretches from 51,000 to 68,000 units 6. Using the flexible budget performance report you prepared for Requirement 5, answer the following questions: How much of the master budget variance (calculated in Requirement 4) for operating income is due to volume being higher than expected? How much of the master budget variance for variable expenses is due to some cause other than volume? What could account for the flexible budget variance for sales revenue? What is the volume variance for fixed expenses? Why is it this amount? a. b C. d. Print Done mts Data Table ud ud A B D ud 1 ma 2. (U) The Lasting Balloon Company Actual vs. Budget Performance Report For the Month Ended October 31 two 3 nt to get e bu lec . exibl Master Budget Variance Master Actual Budget 5 Sales volume (number of cases sold) 58,000 56,000 6 Sales revenue $ 176,200 $ 151,200 7 Less: Variable expenses 85,300 72,800 8 Contribution margin $ 90,900 $ 78,400 9 Less: Fixed expenses 74,800 73,000 $ 16,100 $ 5,400 10 Operating income much volu much e? could is the Print Done Canon Industries has gathered the following information about the actual sales revenues and expenses for its pharmaceuticals segment for the most recent year. Click the icon to view the actual data.) Budgeted data for the same time period for the pharmaceutical segment are as follows (all data are in millions): Click the icon to view the budgeted data.) Prepare a segment margin performance report for the pharmaceutical segment. Calculate a variance and a variance percentage for each line in the report. Round to the nearest hundredth for the variance percentages (for example, if your answer is 16.2384%, round it to 16.24%). Begin by preparing the performance report through the contribution margin line. Next, complete the report through the segment margin line, and then, finally, complete the report through the operating income line. (Enter the variances as positive numbers. Round the variance percentages to the nearest hundredth percent, XXX%.) Performance Report Canon - Pharmaceutical Segment For Fiscal Year Ending December 31 Actual Bugeted Variance Variance % % Sales Less Variable Expenses: Variable Cost of Goods Sold Variable Operating Expenses Contribution Margin % % Performance Report Canon - Pharmaceutical Segment For Fiscal Year Ending December 31 Actual Bugeted Variance Varianc Data Table es Sales $ 806,400 $ 237,600 $ 130,950 Variable Cost of Goods Sold Variable Operating Expenses Direct Fixed Manufacturing Overhead Direct Fixed Operating Expenses Common Fixed Expenses $ 98,100 31,200 ..... $ 23,320 Print Done % per of i Data Table atii on 9,000 80 24 Budgeted sales in units Budgeted average selling price per unit $ Variable Cost of Goods Sold per unit Variable Operating Expenses per unit $ Direct Fixed Manufacturing Overhead (in total) $ Direct Fixed Operating Expenses (in total) $ Common Fixed Expenses Allocated to the Pharmaceutical Segment $ 15 -- 90,000 30,000 22.000 Print Done
