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Mountain Manufacturing: Budget and Performance Report

Mountain Manufacturing had established the following budget information:
1. Finish the missing information :

Sales in Units .
Units 100,000 150,000 200,000

Sales $1,800,000 ______________ ______________

Less variable expenses:
Raw Materials 300,000 ______________ ______________
Direct Labor 350,000 ______________ ______________
Manufacturing overhead 225,000 ______________ ______________
Selling and Administration 90,000 ______________ ______________
Total variable expense 725,000 ______________ ______________

Contribution Margin 965,000 ______________ ______________

Less Fixed Expense:
Manufacturing Overhead 200,000 ______________ ______________
Selling and Administration 150,000 ______________ ______________
Total fixed expense 350,000 ______________ ______________

Net Operating Income $ 615,000 ______________ ______________

Actual Data for the year is as follows:

Units sold 190,000
Sales $3,400,000
Variable expenses:
Raw Materials 574,000
Direct Labor 662,000
Manufacturing overhead 429,000
Selling and Administration 170,000
Fixed Expense:
Manufacturing Overhead 203,000
Selling and Administration 151,000

2. Using the information in Part 1, prepare a performance report for the year for Mountain Manufacturing:

Headings _Budget_______ __Actual_______ _Variance______

Sales $_____________ $_____________ $_____________

Less variable expenses:
Raw Materials ______________ ______________ ______________
Direct Labor ______________ ______________ ______________
Manufacturing overhead ______________ ______________ ______________
Selling and Administration ______________ ______________ ______________
Total variable expense ______________ ______________ ______________

Contribution Margin ______________ ______________ ______________

Less Fixed Expense:
Manufacturing Overhead ______________ ______________ ______________
Selling and Administration ______________ ______________ ______________
Total fixed expense ______________ ______________ ______________

Net Operating Income $_____________ $_____________ $_____________

(See attached file for full problem description)

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Solution Summary

Provides the missing information for Budget and prepares a performance report.

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