Question

Exercise 23-16 (Part Level Submission) The Sports Equipment Division of Harrington Company is operated as a profit center. Sales for the division were budgeted for 2020 at $900,000. The only variable costs budgeted for the division were cost of goods sold ($440,000) and selling and administrative ($60,000). Fixed costs were budgeted at $100,000 for cost of goods sold, $90,000 for selling and administrative, and $70,000 for noncontrollable fixed costs. Actual results for these items were: $880,000 Sales Cost of goods sold Variable Fixed Selling and administrative Variable 408,000 105,000 Fixed 61,000 66,000 90,000 Noncontrollable fixed (a) Your answer is partially correct. Try again. Prepare a responsibility report for the Sports Equipment Division for 2020. (List variable costs before fixed costs.) HARRINGTON COMPANY Sports Equipment Division Responsibility Report For the Year Ended December 31, 2020 Budget Actual Difference Favorable Unfavorable

Answer 1

		Budget	actual	Difference/Fvourable unfavourable
sales		900000	880000	20000	U
Variable costs:
Cost of goods sold		440000	408000	32000	F
selling administrative		60000	61000	1000	U
Total variable costs		500000	469000	31000	F
Contribution margin		400000	411000	11000	F
controllable fixed costs
Cost of goods sold		100000	105000	5000	U
selling administrative		90000	66000	24000	F
Total controllable fixed cost		190000	171000	19000	F
controllable margin		210000	240000	30000	F