these are some basic information provided in question 1 i hope it helps you
Question 5 In order to assess the performance of their enterprise, the four friends decided to compare the actual results with their planning budget. Table 2 - Actual Results Actual Results Sales $ 4,950 Cost of goods sold: Direct materials $ 475 Direct labor $ 1,floo Manufacturing $ 240 $2,315 overhead Gross margin $ 2,f135 Selling and administrative expenses: Lease of gazebo $ 50 Stand permit $250 $300 Net operating income $ 2,335 Required a) Prepare the planning budget using an expected level of activity of selling 2,000 BBQ and 2,000 balloons. (8 Marks) b) Compare the planning budget with the actual results and identify the activity variances and the revenue and spending variances. (8 marks) c) Explain who is to blame for the differences identiled between the planning budget and the actual results. (Al marks) LUTE Download BBQ & Balloons Four friends - John, Paul, Ringo, and George - have decided to put a stand outside a shopping centre entrance for selling barbecue and balloons to members of the public during a weekend. The enterprise was named BBQ & Balloons. Please note the suggestions refer to exhibits from the textbook. Question 1 Each barbecue is sold for $2.00 and each balloon is sold for $1.00. Throughout the two days, the four friends were able to sell 2,000 barbecues and 1,000 balloons. The four friends did not have to bother about the stock of sausage and bread or balloons. They made an arrangement with a supplier and had to pay only $0.25 per barbecue served (a slice of bread and a sausage) and $0.03 for each balloon. For the sake of remuneration, the friends have agreed that each one would receive $400 for the two days of hard work. Besides the expense of labour and material, the four friends had other expenses for the two days. For the sake of simplicity, two expenses were related to the production process, which was leasing a BBQ ($200) and a balloon pump ($50). The other two expenses were related to sales and administrative tasks, which were leasing a gazebo ($50) and geing a permit for having the stand outside the shopping centre ($250). Required Based only on information provided in Question 1 of this assignment prepare an income statement for BBQ & Balloons (suggestion: use Exhibit 7-2 as a model). (8 marks) In order to assess the performance of their enterprise, the four friends decided to compare the actual results with their planning budget. Table 2 - Actual Results Actual Results $ 4,950 Sales $ 475 $ 1,600 $ 240 Cost of goods sold: Direct materials Direct labor Manufacturing overhead Gross margin Selling and administrative expenses: Lease of gazebo Stand permit Net operating income $ 2,315 $ 2,635 50 250 $ 300 $ 2,335 Required a) Prepare the planning budget using an expected level of activity of selling 2,000 BBQ and 2,000 balloons. (8 marks) b) Compare the planning budget with the actual results and identify the activity variances and the revenue and spending variances. (8 marks) c) Explain who is to blame for the differences identified between the planning budget and the actual results. (6 marks) Question 5 In order to assess the performance of their enterprise, the four friends decided to compare the actual results with their planning budget. Table 2 - Actual Results Actual Results Sales $ 4,950 Cost of goods sold: Direct materials $ 475 Direct labor $ 1,floo Manufacturing $ 240 $2,315 overhead Gross margin $ 2,f135 Selling and administrative expenses: Lease of gazebo $ 50 Stand permit $250 $300 Net operating income $ 2,335 Required a) Prepare the planning budget using an expected level of activity of selling 2,000 BBQ and 2,000 balloons. (8 Marks) b) Compare the planning budget with the actual results and identify the activity variances and the revenue and spending variances. (8 marks) c) Explain who is to blame for the differences identiled between the planning budget and the actual results. (Al marks) LUTE Download BBQ & Balloons Four friends - John, Paul, Ringo, and George - have decided to put a stand outside a shopping centre entrance for selling barbecue and balloons to members of the public during a weekend. The enterprise was named BBQ & Balloons. Please note the suggestions refer to exhibits from the textbook. Question 1 Each barbecue is sold for $2.00 and each balloon is sold for $1.00. Throughout the two days, the four friends were able to sell 2,000 barbecues and 1,000 balloons. The four friends did not have to bother about the stock of sausage and bread or balloons. They made an arrangement with a supplier and had to pay only $0.25 per barbecue served (a slice of bread and a sausage) and $0.03 for each balloon. For the sake of remuneration, the friends have agreed that each one would receive $400 for the two days of hard work. Besides the expense of labour and material, the four friends had other expenses for the two days. For the sake of simplicity, two expenses were related to the production process, which was leasing a BBQ ($200) and a balloon pump ($50). The other two expenses were related to sales and administrative tasks, which were leasing a gazebo ($50) and geing a permit for having the stand outside the shopping centre ($250). Required Based only on information provided in Question 1 of this assignment prepare an income statement for BBQ & Balloons (suggestion: use Exhibit 7-2 as a model). (8 marks) In order to assess the performance of their enterprise, the four friends decided to compare the actual results with their planning budget. Table 2 - Actual Results Actual Results $ 4,950 Sales $ 475 $ 1,600 $ 240 Cost of goods sold: Direct materials Direct labor Manufacturing overhead Gross margin Selling and administrative expenses: Lease of gazebo Stand permit Net operating income $ 2,315 $ 2,635 50 250 $ 300 $ 2,335 Required a) Prepare the planning budget using an expected level of activity of selling 2,000 BBQ and 2,000 balloons. (8 marks) b) Compare the planning budget with the actual results and identify the activity variances and the revenue and spending variances. (8 marks) c) Explain who is to blame for the differences identified between the planning budget and the actual results. (6 marks)
