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Question 1 - Wk 4 - Practice: Planning, Coordinating, and Controlling Business Operations [due Sat] - Connect Skip to main content Wk 4 - Practice: Planning, Coordinating, and Controlling Business Operations [due Sat] Answer Saved Help opens in a new window Save & Exit Submit Submit Item 1 20 points eBook eBook Print Print References References Check my work Check My Work button is now enabled Check my work Check My Work button is now enabled Item 1 The Rooney Management Association held its annual public relations luncheon in April Year 2. Based on the previous year’s results, the organization allocated $27,938 of its operating budget to cover the cost of the luncheon. To ensure that costs would be appropriately controlled, Molly Hubbard, the treasurer, prepared the following budget for the Year 2 luncheon.   The budget for the luncheon was based on the following expectations:   The meal cost per person was expected to be $13.10. The cost driver for meals was attendance, which was expected to be 1,530 individuals. Postage was based on $0.70 per invitation and 3,650 invitations were expected to be mailed. The cost driver for postage was number of invitations mailed. The facility charge is $2,300 for a room that will accommodate up to 1,700 people; the charge for one to hold more than 1,700 people is $2,800. A fixed amount was designated for printing, decorations, the speaker’s gift, and publicity.   ROONEY MANAGEMENT ASSOCIATION Public Relations Luncheon Budget April Year 2 Operating funds allocated$27,938  Expenses    Variable costs    Meals (1,530 × $13.10) 20,043  Postage (3,650 × 0.70) 2,555  Fixed costs    Facility 2,300  Printing 1,080  Decorations 970  Speaker's gift 260  Publicity 730  Total expenses 27,938  Budget surplus (deficit)$0    Actual results for the luncheon follow.   ROONEY MANAGEMENT ASSOCIATION Actual Results for Public Relations Luncheon April Year 2 Operating funds allocated$27,938  Expenses    Variable costs    Meals (1,750 × $13.80) 24,150  Postage (4,650 × 0.70) 3,255  Fixed costs    Facility 2,800  Printing 1,080  Decorations 970  Speaker's gift 260  Publicity 730  Total expenses 33,245  Budget deficit$(5,307)   Reasons for the differences between the budgeted and actual data follow.   The president of the organization, Rodney Snow, increased the invitation list to include 1,000 former members. As a result, 4,650 invitations were mailed. Attendance was 1,750 individuals. Because of higher-than-expected attendance, the luncheon was moved to a larger room, thereby increasing the facility charge to$2,800 At the last minute, Ms. Hubbard decided to add a dessert to the menu, which increased the meal cost to $13.8 per person. Printing, decorations, the speaker’s gift, and publicity costs were as budgeted.   Required: a. Prepare a flexible budget and compute the sales and variable cost volume variances based on a comparison between the master budget and the flexible budget. b. Compute flexible budget variances by comparing the flexible budget with the actual  results.   Prev Question 1 of 1 Total 1 of 1 Visit question map This is the last question in the assignment. To submit, use Alt + S. To access other questions, proceed to the question map button. Next Next Question 1 - Wk 4 - Practice: Planning, Coordinating, and Controlling Business Operations [due Sat] - Connect Skip to main content Wk 4 - Practice: Planning, Coordinating, and Controlling Business Operations [due Sat] Answer Saved Help opens in a new window Save & Exit Submit Submit Item 1 20 points Item Skipped eBook eBook Print Print References References Check my work Check My Work button is now enabled Check my work
Answered 2 days AfterMar 31, 2021

Answer To: Question 1 - Wk 4 - Practice: Planning, Coordinating, and Controlling Business Operations [due Sat]...

Bhavani answered on Apr 02 2021
139 Votes
Prepare a flexible budget and compute the sales and variable cost variance based on a comparison between the master budget and flexible budget.
a)
    
    Master budget
    Flexible budget
    Variance
    F /UF
    Allocated funds
    $27938
    $27938
    -
    
    Expenses:
    
    
    
    
    Variable costs
    
    
    
    
    Meals
    20043
    $22925
    2882
    UF
    Postage
    2555
    $3255
    700
    UF
    Fixed costs
    
    
    
    
    Facility
    2300
    2800
    500
    UF
    Printing
    1080
    1080
    -
    
    Decorations
    970
    970
    -
    
    Speaker’s gift
    260
    260
    -
    
    Publicity
    730
    730
    -
    
    Total expenses
    27938
    32020
    4082
    
    Budget deficit
    0
    (4082)
    (4082)
    UF
Working notes:
Meal = 1750 persons * $13.10 = $22925
Postage = 4650 invitations *$0.70=...
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