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Pblem 6-27 (Part Level Submission)
Barnes Entertainment Corporation prepared a master budget for the month of November that was based on sales of 159,100 board games. The budgeted income statement for the period is as follows.
Sales Revenue    $2,545,600
Variable expenses     
  Direct materials  $700,040   
  Direct labor  381,840   
  Variable overhead  493,210   
Total variable expenses    1,575,090
Contribution margin    970,510
Fixed overhead  258,100   
Fixed selling and administrative expenses  504,300   
Total fixed expenses    762,400
Operating income    $208,110

During November, Barnes produced and sold 187,900 board games. Actual results for the month are as follows.

Sales Revenue    $2,995,000
Variable expenses     
  Direct materials  $813,060   
  Direct labor  467,460   
  Variable overhead  593,490   
Total variable expenses    1,874,010
Contribution margin    1,120,990
Fixed overhead  274,300   
Fixed selling and administrative expenses  504,300   
Total fixed expenses    778,600
Operating income    $342,390
arning
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(a) Prepare a flexible budget for November. (Round unit answers to 2 decimal places, e.g. 5.25 & all other answers to 0 decimal places, e.g. 125.)
 (b) Calculate Barnes’s static budget variance for November. (Round answers to 0 decimal places, e.g. 125. Enter all variance amounts as positive values. If variance is zero, select “Not Applicable” and enter 0 for the amounts.)
  Actual Results  Static Budget Variance  Static Budget
The parts of this question must be completed in order. This part will be available when you complete the part above.
Pblem 5-31 (Part Level Submission)
Strum Enterprises is a boutique guitar manufacturer. The company produces both acoustic and electric guitars for rising and established professional musicians. Claire Strum, the company’s sales manager, prepared the following sales forecast for 2015. The forecasted sales prices include a 5 percent increase in the acoustic guitar price and a 10 percent increase in the electric guitar price, to cover anticipated increases in raw materials prices.
  Sales Price  1st Quarter  2nd Quarter  3rd Quarter  4th Quarter
Acoustic guitar sales  $1,450   400   580   370   600  
Electric guitar sales  $2,690   200   100   120   150  
Prepare Strum’s sales budget for 2015.
Sales Budget
 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Annual
 On December 31, 2014, Strum had 60 acoustic guitars in stock—fewer than the desired inventory level of 80 guitars, based on the following quarter’s sales. The company has budgeted for sales of 500 acoustic guitars in the first quarter of 2016. Strum wants to maintain an ending inventory equal to 20 percent of the following quarter’s sales. Prepare the 2015 production budget for acoustic guitars.
Production Budget
 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Annual
Budgeted ending inventoryTotal units requiredBudgeted productionBeginning inventoryBudgeted unit sales     
Budgeted productionBudgeted unit salesTotal units requiredBudgeted ending inventoryBeginning inventory     
Beginning inventoryBudgeted ending inventoryTotal units requiredBudgeted unit salesBudgeted production     
Beginning inventoryTotal units requiredBudgeted productionBudgeted ending inventoryBudgeted unit sales     
Budgeted unit salesTotal units requiredBudgeted ending inventoryBudgeted productionBeginning inventory     
(c) The parts of this question must be completed in order. This part will be available when you complete the part above.