The purpose of Business Assignment 2 is to complete and analyze a Flexible Budget Performance Report similar to Exhibit 11-4 on page 423 of our text. Students should consider the information provided in the story line below when explaining the reasons for the variances computed. The Board Company (TBC) produces book cases out of wood recycled from old barns. In early September, the following conversation occurred between TBC employees Tom Oak, the production supervisor and Sue Poplar, the managerial accountant. Tom: "Boy, I'm glad August is over. It was a tough month. The orders just kept coming in. We ended up working so much overtime I thought my workers were going to quit. And the boards we had to use near the end of the monththe quality was substandard even though we paid much more for the boards. We had quite a bit of waste." Sue: I hear you Tom. Now that the August numbers are in, I'm seeing that utility costs appear to be more fixed and less variable that we previously thought. It could be that management will want to push for a higher level of production in the future." Tom: "Well, if you're right, I will need to hire more workers. And Purchasing will have to do a better job at securing quality wood from those barn tear-downs. What are the numbers for August? Sue: "The actual cost numbers for August are: $ Direct materials Direct labor Variable overhead Fixed overhead 27,950 138,750 23,960 115,390 Tom: Boy that has to be way over budget. How bad is it?" Sue: "Well, I don't know quite yet. The original static budget was based upon 9,000 units for August: $ Direct materials Direct labor Variable overhead Fixed overhead 25,200 126,000 23,400 111,020 But actual production was 9,480 units for August. I need the students in ACC 122 at WCC to complete a Flexible Budget Performance Report for us. Then we can analyze the variances." Requirement 1: Complete the Flexible budget Performance Report for The Board Company for the month ended August 31. Use excel to do all computations. Make sure your numbers are formatted with dollar signs on the first and last number of each column and commas for all other numbers. Indicate whether the variances are favorable or unfavorable. Requirement 2: Answer questions 1-4 using complete sentences. Insert a text box and make sure you answers fit properly on the page. Requirement 3: Save your excel file in box A1. Name your file with your last name (BA2Davies) and upload in the box provided on blackboard. Business Assignment 2 is worth 50 points as follows: Points Available File saved at top of page Name included in file name Name at top of the page Numbers are formatted per instructions Variances are computed properly Excel formulas used to compute variances Answer to question 1 correct Answer to questions 2 and 3 correct Answer to question 4 correct Total Requirement 1: Complete the following flexible budget performance report using the numbers from the Business Assignment 2 Instructions file. The Board Company Flexible Budget Performance Report for the month ended August 31 Budgeted units of production: Actual units of production: Units of production variance (A-B) F/U (A-C) FIU Actual Costs Incurred for 9.480 units Flexible Budget Based on 9.480 units Flexible Budget Variance Static Budget Based on 9.000 units Static Budget Variances Variable Costs: Direct materials Direct labor Variable overhead Subtotal Fixed costs: Fixed overhead Total Requirement 2: Answer the following questions using complete sentences. Use the information provided in the Business Assignment 2 Instructions file Add lines/ spaces as needed. 1. Give the explanation for the flexible budget variances for: Direct materials Direct labor Variable overhead Fixed overhead 2. Is the units of production variance favorable or unfavorable? Why? 3. Give the explanation for the static budget variances. 4. Give three suggestions that The Board Company should consider to improve the flexible budget variances in future months. A. The purpose of Business Assignment 2 is to complete and analyze a Flexible Budget Performance Report similar to Exhibit 11-4 on page 423 of our text. Students should consider the information provided in the story line below when explaining the reasons for the variances computed. The Board Company (TBC) produces book cases out of wood recycled from old barns. In early September, the following conversation occurred between TBC employees Tom Oak, the production supervisor and Sue Poplar, the managerial accountant. Tom: "Boy, I'm glad August is over. It was a tough month. The orders just kept coming in. We ended up working so much overtime I thought my workers were going to quit. And the boards we had to use near the end of the monththe quality was substandard even though we paid much more for the boards. We had quite a bit of waste." Sue: I hear you Tom. Now that the August numbers are in, I'm seeing that utility costs appear to be more fixed and less variable that we previously thought. It could be that management will want to push for a higher level of production in the future." Tom: "Well, if you're right, I will need to hire more workers. And Purchasing will have to do a better job at securing quality wood from those barn tear-downs. What are the numbers for August? Sue: "The actual cost numbers for August are: $ Direct materials Direct labor Variable overhead Fixed overhead 27,950 138,750 23,960 115,390 Tom: Boy that has to be way over budget. How bad is it?" Sue: "Well, I don't know quite yet. The original static budget was based upon 9,000 units for August: $ Direct materials Direct labor Variable overhead Fixed overhead 25,200 126,000 23,400 111,020 But actual production was 9,480 units for August. I need the students in ACC 122 at WCC to complete a Flexible Budget Performance Report for us. Then we can analyze the variances." Requirement 1: Complete the Flexible budget Performance Report for The Board Company for the month ended August 31. Use excel to do all computations. Make sure your numbers are formatted with dollar signs on the first and last number of each column and commas for all other numbers. Indicate whether the variances are favorable or unfavorable. Requirement 2: Answer questions 1-4 using complete sentences. Insert a text box and make sure you answers fit properly on the page. Requirement 3: Save your excel file in box A1. Name your file with your last name (BA2Davies) and upload in the box provided on blackboard. Business Assignment 2 is worth 50 points as follows: Points Available File saved at top of page Name included in file name Name at top of the page Numbers are formatted per instructions Variances are computed properly Excel formulas used to compute variances Answer to question 1 correct Answer to questions 2 and 3 correct Answer to question 4 correct Total Requirement 1: Complete the following flexible budget performance report using the numbers from the Business Assignment 2 Instructions file. The Board Company Flexible Budget Performance Report for the month ended August 31 Budgeted units of production: Actual units of production: Units of production variance (A-B) F/U (A-C) FIU Actual Costs Incurred for 9.480 units Flexible Budget Based on 9.480 units Flexible Budget Variance Static Budget Based on 9.000 units Static Budget Variances Variable Costs: Direct materials Direct labor Variable overhead Subtotal Fixed costs: Fixed overhead Total Requirement 2: Answer the following questions using complete sentences. Use the information provided in the Business Assignment 2 Instructions file Add lines/ spaces as needed. 1. Give the explanation for the flexible budget variances for: Direct materials Direct labor Variable overhead Fixed overhead 2. Is the units of production variance favorable or unfavorable? Why? 3. Give the explanation for the static budget variances. 4. Give three suggestions that The Board Company should consider to improve the flexible budget variances in future months. A