Question
[The following information applies to the questions displayed below.] Harlow Parts produces a single product at its Superior Plant. The master budget for July follows:
[The following information applies to the questions displayed below.]
Harlow Parts produces a single product at its Superior Plant. The master budget for July follows:
| Harlow Parts | |
|---|---|
| Superior Plant | |
| Master Budget | |
| (For July) | |
| Quantity | 8,000 |
| Revenue | $ 1,520,000 |
| Variable manufacturing cost | 576,000 |
| Variable Selling, General and Administrative cost | 96,000 |
| Contribution margin | $ 848,000 |
| Fixed manufacturing cost | 192,000 |
| Fixed Selling, General and Administrative cost | 350,000 |
| Operating profit | $ 306,000 |
The following operating income statement shows the actual results for July:
| Harlow Parts | |
|---|---|
| Superior Plant | |
| Operating Results | |
| (For July) | |
| Quantity (units) | 9,400 |
| Revenue | $ 1,710,800 |
| Variable manufacturing cost | 700,394 |
| Variable Selling, General and Administrative cost | 109,040 |
| Contribution margin | $ 901,366 |
| Fixed manufacturing cost | 203,040 |
| Fixed Selling, General and Administrative cost | 360,000 |
| Operating profit | $ 338,326 |
Required:
Help the managers at Harlow understand the implications from the profit variance analysis by writing a short summary of your analysis. Include visualizations to highlight your conclusions.
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Managerial Accounting
Authors: Libbey Phillips Whitecotton
2nd Edition
1259240908, 978-1259240904
