Problem 24-4A |
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Your answer is correct. |
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Johnson Manufacturing Inc. operates the Patio Furniture Division as a profit center. Operating data for this division for the year ended December 31, 2012, are as shown below.
Budget |
Difference |
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Sales |
$2,500,000 |
$60,000 |
F |
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Cost of goods sold |
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Variable |
1,300,000 |
41,000 |
F |
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Controllable fixed |
200,000 |
6,000 |
U |
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Selling and administrative |
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Variable |
220,000 |
7,000 |
U |
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Controllable fixed |
50,000 |
2,000 |
U |
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Noncontrollable fixed costs |
70,000 |
4,000 |
U |
In addition, Johnson Manufacturing incurs $180,000 of indirect fixed costs
that were budgeted at $175,000. Twenty percent (20%) of these costs are
allocated to the Patio Furniture Division.
Prepare a responsibility report for the Patio Furniture Division for the year.
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