solve

PR 11-39 (Algo) Budgets and Performance Evaluation (LO 11-1, 11-6) Johnson Electrlcal produces Industrlal ventllatlon fans. The company plans to manufacture 84,000 fans evenly over the next quarter at the followlng costs: dlrect materlal, dlrect labor, S588.OOO. verleOIe productlon overhead, $659,400, and fixed productlon overhead, $951,000. The $951,000 amount Includes $96,000 of strelghl-llne depreclatlon and $108,000 of supeMsory solarles. Shortly after the concluslon of the quarter's first month, Johnson reported the followlng costs: 183 productio 22s , ege 32, 38, 248, ege Other f d production sel,sge S 1 , 02, gge Dave Kellerman end hls crews turned out 25,000 fans durlng the montha remarkable feet glven that the firm's manufacturlng plant wes closed for several days because of storm damage and floodlng Kellerman was especlalty pleosed wlth the fact that overan finenclel performance for the perlod was favorable when compared the bueget HIS pleasure, however, vvos very Shon-nved, es Johnson's general manager Issued stern warnlng the: performance must Improve, and Improve qulckly, If Kellerman had any hopes of keeplng hLs Job. Requ Ired: 1. Expleln the dlfference between statlc budget end a flexlble budget 2. Vlhlch of the tvvo budgets would Oe more useful when plannlng the company's cash needs over renge of ectlvlty? 3. Prepare a performance report that compares statlc budget end actual costs for the perlod Just ended (I.e., the report that Kellerman Ilkely used when assesslng Fl(s peformence) 4. Prepare a performance report that compares flexlOle budget end actual costs for the perlod Just ended (I.e., the report that the general manager Ilkety used when assesslng Kellerman's performance). . Vlhlch of the follovvlng two reports Is preferred? 3b. Whlch of the followlng statements Is false? Complete this question by entering your the tabs rt th t flexible bud g n perfomn effect o d actual costs for the period J st Sl " or "unfavorable". Select Non d ( , report that the gen Note: the " e" and enter "O" fo ce)D nd intermediate lculat