Question
In: Accounting
The Omega Corporation manufactures two types of vacuum cleaners: the ZENITH for commercial building use and...
The Omega Corporation manufactures two types of vacuum cleaners: the ZENITH for commercial building use and the House-Helper for residences. Budgeted and actual operating data for the year 2018 are as follows:
Static Budget ZENITH House-Helper Total
Number sold 15,000 60,000 75,000
Contribution margin $3,750,000 $12,000,000 $15,750,000
Actual Results ZENITH House-Helper Total
Number sold 16,500 38,500 55,000
Contribution margin $6,200,000 $10,200,000 $16,400,000
Assume that Omega Corporation operates in Midwest market. The total Midwest market is expected to be 500,000 units in sales volume for 2018. The actual total Midwest market for 2018 was 440,000 units in sales volume.
Required: Label all variances as either favorable (F) or unfavorable (UF)
- Calculate the total contribution margin for the flexible budget.
- Determine the total static-budget variance, the total flexible-budget variance, and the total sales-volume variance in terms of the contribution margin.
- Calculate the market-share and market size variances in contribution margin terms for the Omega Corporation for 2018.
Solutions
ekkarill92 answered 2 years agoRelated Solutions
The Octova Corporation manufactures two types of vacuum cleaners: the ZENITH for commercial building use and...
The Octova Corporation manufactures two types of vacuum
cleaners: the ZENITH for commercial building use and the
House-Helper for residences. Budgeted and actual operating data for
the year 2017 are as follows:
Static
Budget
Zenith
House-Helper
Total
Number
sold
20,000
80,000
100,000
Contribution
margin
$4,600,000
$15,200,000
$19,800,000
Actual
Results
Zenith
House-Helper
Total
Number
sold
21,500
64,500
86,000
Contribution
margin
$6,665,000
$14,190,000
$20,855,000
Computer the variances below in terms of contribution margin $.
Indicate whether the variance is favorable or unfavorable....
The Fortise Corporation manufactures two types of vacuum cleaners, the Victor for commercial building use and...
The Fortise Corporation manufactures two types of vacuum
cleaners, the Victor for commercial building use and the House−Mate
for residences. Budgeted and actual operating data for the year
2017 were as follows:
Static Budget
Victor
House-Mate
Total
Number sold
6,000
24,000
30,000
Contribution margin
$1,600,000
$3,120,000
$4,720,000
Actual Results
Victor
House-Mate
Total
Number sold
5,000
35,000
40,000
Contribution margin
$1,580,000
$4,180,000
$5,760,000
What is the total static−budget variance in terms of the
contribution margin?
A.
$1,080,000 favorable
B.
$1,040,000...
Clover Co are manufacturing and selling commercial vacuum cleaners. They have gathered following expected information for...
Clover Co are manufacturing and selling commercial vacuum
cleaners. They have gathered following expected information for the
year 2020:
Selling price (per unit)
£425.00
Direct materials (per unit)
£105.00
Direct labour (per unit)
£56.00
Other costs are estimated for the year
2020 based on the expected sales of 92,000 units. These costs are
given below:
Fixed Costs
Variable Costs
Operating Costs
1,150,000
6,450,000
Marketing Costs
240,000
8,200,500
Storage Costs
80,000
942,000
Administration Costs
550,000
-
For the year 2020, showing...
Tanek Industries manufactures and sells three different models of wet-dry shop vacuum cleaners. Although the shop...
Tanek Industries manufactures and sells three different models
of wet-dry shop vacuum cleaners. Although the shop vacs vary in
terms of quality and features, all are good sellers. Tanek is
currently operating at full capacity with limited machine
time.
Sales and production information relevant to each model
follows.
Product
Economy
Standard
Deluxe
Selling price
$33
$55
$110
Variable costs and expenses
$18
$22
$52
Machine hours required
0.5
0.8
1.6
Calculate contribution margin per unit.
Product
Economy
Standard
Deluxe
Contribution...
Englehart Company sells two types of pumps. One is large and is for commercial use. The...
Englehart Company sells two types of pumps. One is large and is
for commercial use. The other is smaller and is used in residential
swimming pools. The following inventory data is available for the
month of March.
Accounting
(a) Assuming Englehart uses a periodic inventory system,
determine the cost of inventory on hand at March
31 and the cost of goods sold for March under first-in,
first-out (FIFO).
(b) Assume Englehart uses dollar-value LIFO and
one pool, consisting of the...
Whispering Company sells two types of pumps. One is large and is for commercial use. The...
Whispering Company sells two types of pumps. One is large and is
for commercial use. The other is smaller and is used in residential
swimming pools. The following inventory data is available for the
month of March.
Units
Price per
Unit
Total
Residential Pumps
Inventory at Feb. 28:
222
$
444
$
98,568
Purchases:
March 10
555
$
500
$
277,500
March 20
444
$
527
$
233,988
March 30
333
$
555
$
184,815
Sales:
March 15
555
$...
1. Motor Company manufactures two types of specialty electric motors, a commercial motor and a residential...
1. Motor Company manufactures two types of specialty electric
motors, a commercial motor and a residential motor, through two
production departments, Assembly and Testing. Presently, the
company uses a single plantwide factory overhead rate for
allocating factory overhead to the two products. However,
management is considering using the multiple production department
factory overhead rate method. The following factory overhead was
budgeted for Pineapple: 1 Assembly Department $420,000.00 2 Testing
Department 1,200,000.00 Direct machine hours were estimated as
follows: Assembly Department...
Pineapple Motor Company manufactures two types of specialty electric motors, a commercial motor and a residential...
Pineapple Motor Company manufactures two types of specialty
electric motors, a commercial motor and a residential motor,
through two production departments, Assembly and Testing.
Presently, the company uses a single plantwide factory overhead
rate for allocating factory overhead to the two products. However,
management is considering using the multiple production department
factory overhead rate method. The following factory overhead was
budgeted for Pineapple:
1
Assembly Department
$330,000.00
2
Testing Department
1,200,000.00
3
Total
$1,530,000.00
Direct machine hours were estimated as...
Pineapple Motor Company manufactures two types of specialty electric motors, a commercial motor and a residential...
Pineapple Motor Company manufactures two types of specialty
electric motors, a commercial motor and a residential motor,
through two production departments, Assembly and Testing.
Presently, the company uses a single plantwide factory overhead
rate for allocating factory overhead to the two products. However,
management is considering using the multiple production department
factory overhead rate method. The following factory overhead was
budgeted for Pineapple:
1
Assembly Department
$360,000.00
2
Testing Department
900,000.00
3
Total
$1,260,000.00
Direct machine hours were estimated as...
Pineapple Motor Company manufactures two types of specialty electric motors, a commercial motor and a residential...
Pineapple Motor Company manufactures two types of specialty
electric motors, a commercial motor and a residential motor,
through two production departments, Assembly and Testing.
Presently, the company uses a single plantwide factory overhead
rate for allocating factory overhead to the two products. However,
management is considering using the multiple production department
factory overhead rate method. The following factory overhead was
budgeted for Pineapple:
1
Assembly Department
$360,000.00
2
Testing Department
900,000.00
3
Total
$1,260,000.00
Direct machine hours were estimated as...
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