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Torres Company accumulates the following summary data for the year ending December 31, 2020, for its...

Torres Company accumulates the following summary data for the year ending December 31, 2020, for its Water Division, which it operates as a profit center: sales—$2,000,000 budget, $2,080,000 actual; variable costs—$1,000,000 budget, $1,050,000 actual; and controllable fixed costs—$300,000 budget, $305,000 actual. Prepare a responsibility report for the Water Division for the year ending December 31, 2020. Prepare a responsibility report for a profit center.

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Prepare a responsibility report
Budget Actual Favorable unfavorable neither favorable nor unfavorable
Sales                20,00,000                    20,80,000                          80,000 Favorable
Variable cost                10,00,000                    10,50,000                          50,000 Unfavorable
Contribution margin                10,00,000                    10,30,000                          30,000 Favorable
Fixed cost                  3,00,000                      3,05,000                            5,000 Unfavorable
Controllable margin                  7,00,000                      7,25,000                          25,000 Favorable

ekkarill92 answered 2 years ago
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