4{7113 Axrigrrnent PrintMav 11. Problem 21-3A Part 3 3. The company's business conditions are impmling. One prrssible result is a sales \olume of approximately 18,fi)0 units. The company president is confident that this \plume is within the rcle\Bnt range of existing capacity. Hor,v much \ilould operating income il:crease orgr the 2011 budgeled amount of $379,000 if lhis lercl is reached without increasing capacity? {Do not round intermediate calculatione, Omit the "$" sign in your reryon*.) Operating income increase $ ldVorksheet Fra$leni ?f -34 Parf 3 Learning ilbjective: 21-F1 Prepare a *exible budget and interpret a flexible budget perf*rmance report. Difficulty Mediurn 12. Probfem 21-3A Part 4 4. An unhrcrable change in business is rcmotely possible; in this case, pDduction and sales rolume br 2011 could fall to 12,000 units. Ho,v much income (or loss) tom operations would occur if sales \Dlume hlls to this lelel? flnput the amount as positive value. Do nol round intermediate calculations Omit the '$" dgn in your response.) ffi$_ Worksheet Pr*bJem ?1-34 Part 4 Learning Object r{}: 21-P1 Prepsre a flexible budget and interpret a flr:xible budget performance repor"t. Problem 21-5A Flexible budget preparation; computatian af mateilals, labar, and overhead wriances: and overhead variance repart L.Q. Pl, P2, P3, C2 [fhe fallowing intomalian applies b the guestions dlsplayed belowJ Kwikeee Cornpany set the following standard costs br one unit of its product. Direct matedals {{3.0 hs. @ $+.o per h.) $ 12.00 Dir€ctlabor(1.5hrs. @$14.0perhr.) 21.0O Orerhead (1.5 hns. @ $18.50 perhr.) 27.75 Total sfandard cost $ 60.75 The F€detemined o\,ethead rate ($18.50 psr direct labor hour) is basr:d on an expected wlume of 75% of the factory's capacity of 20,000 units pet month. Fdlowing are the conrpany's budgeted oerhead costs per month at the 75% le\el- Owrhead Budget (75% Capacity) Variable owrhead costs lndirect materials lndirect labor Power Repairs and maintenance Total wriable orerhead costs Fixed o\,erhead costs Depreciation*buil di ng Depreciiltion*rn acni n ery Taxes and insufiance Supenisrion Total fixed overhead cost$ Total ow*rcad costs sto. rrhecl oud. nng ranA hi I I . cory?rntpx $ 15,000 75,000 15,000 30,000 $ 135,000 24,440 70,ooa 20,000 167,250 ?,81,?:50 $ 416,250 7tfi 4f7t13 13, I UrJorkshelt i *t I I I t. I I I I I I I I{.i I I i I ....,...)... .."... I eeto. nfted u.d.nug ru*,i,, .conr/trm.px I I IiA The com4nt incuned the fullarrrdng actual costs ufien it operated at nmffiPrintMerr 6 capcity in fttober, 195,300 443,300 57S,250 of each wriable and fixed cost at amqunt per unit ansrers to 2 COMPANY Oterhead Budgets Ended Oct$er 31 ble Budget $ 43,250 176,500 17,zffi 34,500 24,OW 94,500 19,000 167,250 Total castls __ L -__.- I I $ection Brpak I 1,213,950 Problam 21-5A b le b udget preparatian ; campufutian af m ials, Iab or, and averhead yanances,'and o P3, C2 d van'.

1. 4{7113 Axrigrrnent PrintMav
11.
Problem 21-3A Part 3
3. The company's business conditions are impmling. One
prrssible result is a sales olume of
approximately 18,fi)0 units. The company president is confident
that this plume is within the rcleBnt
range of existing capacity. Hor,v much ilould operating income
il:crease orgr the 2011 budgeled amount
of $379,000 if lhis lercl is reached without increasing capacity?
{Do not round intermediate
calculatione, Omit the "$" sign in your reryon*.)
Operating income increase $
ldVorksheet
Fra$leni ?f -34 Parf 3
Learning ilbjective: 21-F1 Prepare a *exible budget
and interpret a flexible budget perf*rmance report.
Difficulty Mediurn
12.
Probfem 21-3A Part 4
4. An unhrcrable change in business is rcmotely possible; in this
case, pDduction and sales rolume br

2. 2011 could fall to 12,000 units. Ho,v much income (or loss) tom
operations would occur if sales Dlume
hlls to this lelel? flnput the amount as positive value. Do nol
round intermediate calculations
Omit the '$" dgn in your response.)
ffi$_
Worksheet
Pr*bJem ?1-34 Part 4 Learning Object r{}: 21-P1 Prepsre a
flexible budget
and interpret a flr:xible budget performance repor"t.
Problem 21-5A Flexible budget preparation; computatian af
mateilals, labar, and overhead wriances: and overhead variance
repart L.Q. Pl, P2,
P3, C2
[fhe fallowing intomalian applies b the guestions dlsplayed
belowJ
Kwikeee Cornpany set the following standard costs br one unit
of its product.
Direct matedals {{3.0 hs. @ $+.o per h.) $ 12.00
Dir€ctlabor(1.5hrs. @$14.0perhr.) 21.0O
Orerhead (1.5 hns. @ $18.50 perhr.) 27.75
Total sfandard cost $ 60.75
The F€detemined o,ethead rate ($18.50 psr direct labor hour) is
basr:d on an expected wlume of 75% of
the factory's capacity of 20,000 units pet month. Fdlowing are
the conrpany's budgeted oerhead costs per
month at the 75% leel-
Owrhead Budget (75% Capacity)
Variable owrhead costs

3. lndirect materials
lndirect labor
Power
Repairs and maintenance
Total wriable orerhead costs
Fixed o,erhead costs
Depreciation*buil di ng
Depreciiltion*rn acni n ery
Taxes and insufiance
Supenisrion
Total fixed overhead cost$
Total ow*rcad costs
sto. rrhecl oud. nng ranA hi I I . cory?rntpx
$ 15,000
75,000
15,000
30,000
$ 135,000
24,440
70,ooa
20,000
167,250

4. ?,81,?:50
$ 416,250
7tfi
4f7t13
13,
I
UrJorkshelt
i
*t
I
I
I
t.
I
I
I
I
I
I

5. I
I{.i
I
I
i
I
....,...)... .."...
I
eeto. nfted u.d.nug ru*,i,, .conr/trm.px
I
I
IiA
The com4nt incuned the fullarrrdng actual costs ufien it
operated at
nmffiPrintMerr
6 capcity in fttober,
195,300
443,300
57S,250
of each wriable and fixed cost at
amqunt per unit ansrers to 2

6. COMPANY
Oterhead Budgets
Ended Oct$er 31
ble Budget
$ 43,250
176,500
17,zffi
34,500
24,OW
94,500
19,000
167,250
Total castls
__ L -__.-
I
I
$ection Brpak
I
1,213,950
Problam 21-5A b le b udget preparatian ;
campufutian af m ials, Iab or, and averhead
yanances,'and o
P3, C2
d van'ance rcport L.A. Pf, P2,
Vadable

7. Amount
per Unit
Total
Fixed
Cost
Flexible Budget
ftr Unit Sales
of 13,000
FlexiHe Budget
br Unit $ales
of 15,000
|."*.,.."'"-.''.
$i "_- - ;
a*--"-"*- --*-i
'''.'--'' '-,.. .!
i'-' --- '. *"i
ir
i!
." ..-... -. -l
t*'**-.""'^-**^--'-*^'*-1
l:
ii
Flexible Budget
for Unit Sales

8. of 17,000
$- ".
i
i-- - --- "*i
i*^--'**-""'*--''*--'i ;''**'**'"'^*'*-*'"**-"-'*i
:,t;':
i-.f*-.-,,*-.--,,--*--* ...,*..--.,.,-" -., -;!
1i
j. l
t^-."".,",.-
"...-."..".-..... . "-_..,,._.. _" _. :::
ii:
ii
li.-,....-...-....,^.*..-...-."..-*..".,..-,,-,-,..." -..J
Ii
ii
.i...*...-,""....","""*...*,..,."..,.,...,-,...,-.,.,...,-."..i::
i,- .-.- -"'-- i
$ i"_:- :
-:-:
$ i:::"_-:-::_j $ i :::. _: ::-:-j
Leaming Objectiw : 21 -?3 Campute ausrhead
vartances.
I

9. Problem 21-5A Paft 2
I
I
toial rsriaHe costs
fotaflornrhead costs
Aft113 As$ig nrnent Pfint Mew
Prablem 21-SA Pad 3
3. Compute the direct mat€rials c6t Edance, including lts pric'!,
and quantity rariances.{lndicate the
effec't of each variance by selecling "F" for favorable, "U" for
unfavorable, and "None" for no
etr€Et {i-e., zero variance}. lnput all amounts as posilive values
Leave no calls blank - be
certain to enter "0" wherever required. Omit the .$. dgn irr your
response,)
Direct materials cest rariance $ o ll-a :*.-_*T.'l
l+,
Pric;e rariance
Quantity variance
Worksheet
Prob l*m 21 -fiA Part 3

10. iir !* rrn ' ' -" "*::+' :tC Learning Objectiw: ?1-p3 ComBute
ovsrhsad
Eriances.
.-. n rl.-. --,!! lu
Problem 21-SA Part 4
4. Compute the dircct labor cost €dance, including its rate and
e{liciency adances.(lhdicate the effect
of each variance by selecting "F* for favorable, "U" for
unrfay6pS;", and "None" for no efecd
{i.e., zero variancei. lnput all amounts as positave valueg
i..eave no e*lls blank - be certain to
enter "0" wherever required, Omit the "$' dgn in your
resp,:rnse.)
Directlaborcostrariance $ o [E-]T:l:lFl
Raterariance $, o, IU-.., -lT-Jl
Effciencyadance $ o
-'-t,
Worksheet Leaming Obie6lile: 21-C2 Describe lariances and
Leamlng Obiectile: 21-P3 Csmpute ot€rhead
whattheyre€al aboutperformance. 4ariances.
problem21-SApad4 LearningObjectite:21-P1 Prepare
af,exiblebudget
and inlerprei a ir:rxible budget performance report.
Leaming Objecti,e: 21-P2 Compule materials and
labor ,ariances.
t

11. L
lr
lg '- - .*... ,e.. ... .
15.
16.
Problem 21-5A Part 5
5. Prepare a detailed owrtead ariance report that shorvs the
,ariiinces br indilidual items of orerhead.
{Leave no cells blank - be certain lo enter "0" rrherever
nrquired. tndicate the effeet of each
variance by sel€cding "F" for favorable, 'U" for unfayorable,
and "None" for no effect {i,e., zero
variance). lnpul all amounts as positive values, Omit the
KWIKEZE CC,rtu1P461"
Owrhead Varial,ice Report
For Month Ended October 31
% of capacity
% of capacity
ffi
Flelible Fj.fdget ,Agtug,l, Re$illfs Vgrianpes
ffiE:.'o''g.'o..$'9tU.--*__ln
Volurrne Variance
Expected production level

12. Production lewl achiered
Volume rariance
Contrdlable Variance
Varierble owrhead costs
hrrdircet labor i'r
E
irs and mgintenance ' lv
00
0 .' 0
o. offi
Tol;al wriable costs
ezto. nfiecl oud. rrcg ravrr hi I I .con/trm.tpx
0
91fi
4nn3
otrerhead costs
fixed cmts
2't -#A Parl 5
i,*::::ji
i""**"***"

13. L _*"*__ gj
il_:: _:_ pj
i""_-"*"____ 9.i
ffiPrirfrManr
i*__)i_:
i-:---e:i
t*:-----pj
'._-_:::":_p_i
;::* n
i:_ ::*:ei
L -----:---qi
r*-__ _9i
i*'^ - "*
*- *-"- *"*"*-*'*'i
i" --- --- -"- --9j
W
ffi
ffi
ffi
ffi
W
Learning Obj : 21-C2 Describe rmriances and
what they rew pertar*r*nce.
Leaming Obj e:21-FI Prepare *frexble budget
xible budget performance reporl.and inlerpreta

14. Learning Obj
lablluri:nc€s:
Learning Objectiw: 21 -P3 Compute eErhead
rariances.
: 21-P2 Compute ma8rials and
sto.rrheclffrd.mcg ll.cornllunpx 1tr10