Maurice Tutor
$15/per page/Negotiable
Snells is a retail department store. The following cost-volume relationships were used in developing a flexible budget for the company for the current year:
| Â | Yearly Fixed Expenses |
 | Variable Expenses per Sales Dollar | |||
| Cost of merchandise sold | Â | Â | Â | $ | 0.600 | Â |
| Selling and promotion expense | $ | 210,000 | Â | Â | 0.082 | Â |
| Building occupancy expense | Â | 186,000 | Â | Â | 0.022 | Â |
| Buying expense | Â | 150,000 | Â | Â | 0.041 | Â |
| Delivery expense | Â | 111,000 | Â | Â | 0.008 | Â |
| Credit and collection expense | Â | 72,000 | Â | Â | 0.002 | Â |
| Administrative expense | Â | 531,000 | Â | Â | 0.003 | Â |
| Â | Â | Â | ||||
| Totals | $ | 1,260,000 | Â | $ | 0.758 | Â |
| Â | Â | Â | ||||
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Management expected to attain a sales level of $12 million during the current year. At the end of the year, the actual results achieved by the company were as follows: |
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| Â | Â | Â |
| Net sales | $ | 10,500,000 |
| Cost of goods sold | Â | 6,180,000 |
| Selling and promotion expense | Â | 1,020,000 |
| Building occupancy expense | Â | 420,000 |
| Buying expense | Â | 594,000 |
| Delivery expense | Â | 183,000 |
| Credit and collection expense | Â | 90,000 |
| Administrative expense | Â | 564,000 |
| Instructions |
|
Prepare a schedule comparing the actual results with flexible budget amounts developed for the actual sales volume of $10,500,000. Organize your schedule as a partial multiple-step income statement, ending with operating income. Include separate columns for (1) flexible budget amounts, (2) actual amounts, and (3) any amount over (under) budget. Use the cost-volume relationships given in the problem to compute the flexible budget amounts. (Leave no cells blank - be certain to enter "0" wherever required.Amounts to be deducted should be indicated with a minus sign. Omit the "$" sign in your response.) |
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| SNELLS Comparison of Budgeted and Actual Revenue and Expenses For the Year Ended December 31, 20__ |
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| Â | Flexible Budget | Actual | Over (or Under) Budget |
| (Click to select) Net sales Cost of goods sold Operating expenses Credit sales Net purchase | $ | $ | $ |
| (Click to select) Salaries expenses Direct material Cost of goods sold Net sales Dividends payable | Â | Â | Â |
| Â | |||
| (Click to select) Gross profit on purchase Gross profit on sales | $ | $ | $ |
| Â | |||
| Operating expenses: | Â | Â | Â |
| (Click to select) Delivery Selling and promotion Building occupancy Buying Administrative | $ | $ | $ |
| (Click to select) Buying Building occupancy Credit and collection Inventories Delivery | Â | Â | Â |
| (Click to select) Accounts payble Buying Direct labor Delivery Adminstrative | Â | Â | Â |
| (Click to select) Delivery Credit and collection Adminstrative Buying Building occupancy | Â | Â | Â |
| (Click to select) Buying Credit and collection Adminstrative Administrative Building | Â | Â | Â |
| (Click to select) Administrative Depreciation expenses Buying Accounts payble Building | Â | Â | Â |
| Â | |||
| Total operating expenses | $ | $ | $ |
| Â | |||
| Operating income | $ | $ | $ |
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