Budget Analysis
Not what you're looking for?
In December of 2007, Jones Inc. was formed as a corporation. The company plans to start its operations in early January of 2008. They have the following purchases budgeted for the first quarter of 2008:
January $600,000
February 500,000
March 300,000
Jones has worked out agreements with its various suppliers to pay for one-fourth of a month's purchases each month, beginning in the month of purchase, until the purchases are paid in full. No purchases were made prior to January.
What are total cash disbursements expected for the first quarter of 2008?
A. $425,000.
B. $625,000.
C. $775,000
D. $350,000.
Sampson Apparel Inc. incurred actual variable overhead expenses of $62,000 in the current year for the production of 10,000 units. Variable overhead was applied at a rate of $2.00 per direct labor hour and 3 direct labor hours were budgeted for each unit. The company used 29,000 direct labor hours for production. What was Sampson's variable overhead spending variance?
A. $4,000 U
B. $4,000 F.
C. $2,000 U.
D. $2,000 F.
Purchase this Solution
Solution Summary
This two-part budget analysis exercise calls for (1) the calculation of total cash disbursements from a company's monthly financial data, and (2) the determination of the variable overhead spending variance from the company's production data.
Solution Preview
1). In December of 2007, Jones Inc. was formed as a corporation. The company plans to start its operations in early
January of 2008. They have the following purchases budgeted for the first quarter of 2008:
January $600,000
February 500,000
March 300,000
Jones has worked out agreements with its various suppliers to pay for one-fourth of a month's purchases each
month, beginning in the month of purchase, until the purchases are paid in full. No purchases were made prior
to January.
What are total cash disbursements expected for the first quarter ...
Purchase this Solution
Free BrainMass Quizzes
Business Processes
This quiz is intended to help business students better understand business processes, including those related to manufacturing and marketing. The questions focus on terms used to describe business processes and marketing activities.
Income Streams
In our ever changing world, developing secondary income streams is becoming more important. This quiz provides a brief overview of income sources.
Introduction to Finance
This quiz test introductory finance topics.
Production and cost theory
Understanding production and cost phenomena will permit firms to make wise decisions concerning output volume.
Transformational Leadership
This quiz covers the topic of transformational leadership. Specifically, this quiz covers the theories proposed by James MacGregor Burns and Bernard Bass. Students familiar with transformational leadership should easily be able to answer the questions detailed below.