Answered: Nottingham Forest Products reports the…

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter8: Budgeting For Planning And Control

Section: Chapter Questions

Problem 13CE: Nashler Company has the following budgeted variable costs per unit produced: Budgeted fixed overhead...

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Nottingham Forest Products reports the following information concerning operations for the most recent month: Master Budget Actual (based (based on on actual sales budgeted sales of 4,890 units) of 4,075 units) Sales revenue $ 233,200 $ 191,525 Less Manufacturing costs Direct labor Materials Variable overhead Marketing Administrative Total variable costs Contribution margin 50,332 31,550 16,638 7,835 7,245 $ 113,600 $ 119,600 39,030 27,230 13,130 6,230 6,530 $ 92,150 $ 99,375 Fixed costs Manufacturing Marketing Administrative Total fixed costs Operating profits 38,975 14,890 9,555 $ 63,420 $ 56,180 37,430 12,230 10,430 $ 60,090 $ 39,285 There are no inventories. Required: Prepare a sales activity variance analysis for Nottingham Forest Products Note: Do not round intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option.

Nottingham Forest Products reports the following information concerning operations for the most recent month:
Master Budget
(based on
budgeted sales
of 4,075
units)
$191,525
Sales revenue
Less
Manufacturing costs
Direct labor
Materials
Variable overhead
Marketing
Administrative
Total variable costs
Contribution margin
Fixed costs
Manufacturing
Marketing
Administrative
Total fixed costs
Operating profits
There are no inventories.
Actual (based
on actual sales
of 4,890 units)
$ 233,200
50,332
31,550
16,638
7,835
7,245
$ 113,600
$ 119,600
38,975
14,890
9,555
$63,420
$ 56,180
39,030
27,230
13,130
6,230
6,530
$92,150
$ 99,375
37,430
12,230
10,430
$ 60,090
$ 39,285
Required:
Prepare a sales activity variance analysis for Nottingham Forest Products.
Note: Do not round intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable, or "U" for
unfavorable. If there is no effect, do not select either option.

Required:
Prepare a sales activity variance analysis for Nottingham Forest Products.
Note: Do not round intermediate calculations. Indicate the effect of each variance by selecting "F" for favorable, or "U" for
unfavorable. If there is no effect, do not select either option.
Sales revenue
Variable costs:
Manufacturing costs:
Direct labor
Materials
Variable overhead
Marketing
Administrative
Total variable costs
Contribution margin
Fixed costs:
Manufacturing
Marketing
Administrative
Total fixed costs
Operating profits
NOTTINGHAM FOREST PRODUCTS
Sales Activity Variance
Flexible Budget
(based on
actual of 4,890
units)
$
$
$
$
0
0
0
0
Master Budget
(based on
Sales Activity Variance budgeted 4,075
units)
$
55
$
$
$
191,525
39,030
27,230
13,130
6,230
6,530
92,150
99,375
37,430
12,230
10,430
60,090
39,285

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