Question

CHAP 9 ALG 1

Quilcene Oysteria farms and sells oysters in the Pacific Northwest. The company harvested and sold 7,300 pounds of oysters in August. The company's flexible budget for August appears below: Quilcene Oysteria Flexible Budget For the Month Ended August 31 Actual pounds (9) 7,300 $ 30,660 Revenue ($4.209) Expenses: Packing supplies ($0.309) Oyster bed maintenance ($3,400) Wages and salaries ($2,400 + $0.309) Shipping ($0.759) Utilities ($1,240) Other ($490 + $0.019) Total expense Net operating income 2,190 3,400 4,590 5,475 1,240 563 17,458 $ 13,202 The actual results for August appear below: Quilcene Oysteria Income Statement For the Month Ended August 31 Actual pounds 7,300 $ 26,500 Revenue Expenses: Packing supplies Oyster bed maintenance Wages and salaries Shipping Utilities Other Total expense Net operating income 2,360 3,260 5,000 5,205 1,050 1,183 18,058 8,442 $ Required: Calculate the company's revenue and spending variances for August. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values.) Quilcene Oysteria Revenue and Spending Variances For the Month Ended August 31 Revenue Expenses: Packing supplies Oyster bed maintenance Wages and salaries Shipping Utilities Other Total expense Net operating income

Answer 1

Solution 1:

Quilcene Oysteria
Revenue and sepnding variances
For the month ended August 31
Particulars	Actual results	Revenue and spending variances		Flexible Budget
Nos of units	7300			7300
Revenue	$26,500.00	$4,160.00	U	$30,660.00
Expenses:
Packing Supplies	$2,360.00	$170.00	U	$2,190.00
Oyster bed maintenance	$3,260.00	$140.00	F	$3,400.00
Wages and Salaries	$5,000.00	$410.00	U	$4,590.00
Shipping	$5,205.00	$270.00	F	$5,475.00
Utilities	$1,050.00	$190.00	F	$1,240.00
Others	$1,183.00	$620.00	U	$563.00
Total Expenses	$18,058.00	$600.00	U	$17,458.00
Net Operating Income	$8,442.00	$4,760.00	U	$13,202.00

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