Weygandt, Accounting Principles, 12e,
Chapter Twenty Four
Solutions to Challenge Exercises
Solution
CE24-1
(a) Jennings Outdoor Company
Winter Sports Department
Flexible Budget Report
For the Month Ended November 30, 2017
Difference
Favorable F
Budget at Actual Costs at Unfavorable U
Sales in units Per Unit 4,500 4,500 0 F
Variable expenses
Sales commissions $ 30.00 $135,000 $128,000 $ 7,000 F
Advertising expense $ 9.50 42,750 41,750 1,500 F
Travel expense $ 46.25 208,125 202,125 6,000 F
(c)
Jennings Outdoor Company
Winter Sports Department
Flexible Budget Report
For the Month Ended December 31, 2017
Difference
Favorable F
Budget at Actual Costs at Unfavorable U
Sales in units Per Unit 5,500 5,500 0 F
Variable expenses
Sales commissions $ 31.00 $170,500 $164,000 $ 6,500 F
Advertising expense $ 8.00 44,000 42,000 2,000 F
Travel expense $ 46.2 254,375 247,000 7,375 F
CE 24-2
(a) Custer Company
Camping Department
Responsibility Report
For the year ended December 31, 2017
Difference
Favorable F
Budget Actual Unfavorable U
Sales $700,000 $678,000 $ 22,000 U
Variable costs
Cost of goods sold 340,000 315,000 25,000 F
(b)
Budget Actual
Controllable margin $167,000 $184,000
Less: Other fixed costs 69,000 69,000
(c) Custer Company
Camping Department
Responsibility Report
For the year ended December 31, 2017
Difference
Favorable F
Budget Actual Unfavorable U
Sales $875,000 $873,000 $ 2,000 U
Variable costs
Cost of goods sold 425,000 420,000 5,000 F
(d)
Budget Actual
Controllable margin $227,500 $245,000