Question

In: Accounting

1. The actual and budgeted costs for Synergy Inc.'s actual level of activity are as follows:...

1.

The actual and budgeted costs for Synergy Inc.'s actual level of activity are as follows:

		Actual Costs	Budgeted Costs
Units produced		1,500	1,500
Direct materials cost		$5,680	$5,010
Direct labor cost		1,620	1,420
VOH:
	Maintenance	710	625
	Power	300	190
FOH:
	Grounds keeping	1,480	1,220
	Depreciation	540	540

Calculate the flexible budget variance.

a.$110F

b.$1,065U

2.

c.$1,325U

d.$260F

Which of the following is true of an after-the-fact flexible budget?

a.It is a budget created in advance that is based on a particular level of activity.

b.It is used to compute what the costs should be for the level of output that actually occurred.

c.It allows managers to see what costs will be for different levels of activity, thus helping in planning.

d.It allows managers to develop financial results for a number of potential scenarios.

Expert Solution

c. $1,325U

Flexible Budget Variance
	Actual Costs	Budgeted Costs	Variance
Units produced	1,500	1,500	0
Direct materials cost	$ 5,680	$ 5,010	$ 670	U
Direct labor cost	$ 1,620	$ 1,420	$ 200	U
VOH:
Maintenance	$ 710	$ 625	$ 85	U
Power	$ 300	$ 190	$ 110	U
FOH:
Grounds keeping	$ 1,480	$ 1,220	$ 260	U
Depreciation	$ 540	$ 540	$ -
Total	$ 10,330	$ 9,005	$ 1,325	U

2.

d.It allows managers to develop financial results for a number of potential scenarios.

ekkarill92 answered 2 years ago

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