ACG 3341-1 Individual Week 7

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ACG 3341-1 Individual Week 7

ACG 3341-1 Individual Week 7

Exercise 7-16 Flexible budget

Brabham Enterprises manufactures tires for the Formula I motor racing circuit. For August 2014, it budgeted to manufacture and sell 3,000 tires at a variable cost of $74 per tire and total fixed costs of $54,000. The budgeted selling price was $110 per tire. Actual results in August 2014 were 2,800 tires manufactured and sold at a selling price of $112 per tire. The actual total variable costs were $229,600, and the actual total fixed costs were $50,000.

Exercise 7-20 Flexible-budget and sales volume variances

Luster, Inc., produces the basic fillings used in many popular frozen desserts and treats—vanilla and chocolate ice creams, puddings, meringues, and fudge. Luster uses standard costing and carries over no inventory from one month to the next. The ice-cream product group’s results for June 2014 were as follows: