Question

Odessa, Inc., reports the following information concerning operations for the most recent month: Actual (based on actual of 585 units) $ 109,320 Master Budget (based on budgeted 650 units) $117,000 Sales revenue Less Manufacturing costs Direct labor Materials Variable overhead Marketing Administrative Total variable costs Contribution margin Fixed costs Manufacturing Marketing Administrative Total fixed costs Operating profits 13,528 11,670 7,290 5,623 5,850 $ 43,961 $ 65,359 14,300 13,650 9,109 6,305 5,850 49,205 67,795 4,470 9,984 9,364 $ 23,818 $ 41,541 4,600 9,600 9,400 $ 23,600 $ 44,195 There are no inventories Required: Prepare a flexible budget for Odessa, Inc. (Do not round intermediate calculations.) ODESSA, INC. Flexible Budget Sales revenue Variable costs: Manufacturing costs: Direct labor Materials Variable overhead Marketing Administrative Total variable costs Contribution margin Fixed costs: Manufacturing Marketing Administrative Total fixed costs Operating profits

Answer 1

Flexible budget
Sales revenue	105300	=117000/650*585
Variable costs:
Manufacturing costs
Direct labor	12870	=14300/650*585
Materials	12285	=13650/650*585
Variable overhead	8190	=9100/650*585
Marketing	5674.5	=6305/650*585
Administrative	5265	=5850/650*585
Total Variable costs	44284.5
Contribution margin	61015.5
Fixed costs:
Manufacturing	4600
Marketing	9600
Administrative	9400
Total Fixed costs	23600
Operating Profits	37415.5
Alternatively if amount is rounded off:
Flexible budget
Sales revenue	105300
Variable costs:
Manufacturing costs
Direct labor	12870
Materials	12285
Variable overhead	8190
Marketing	5675
Administrative	5265
Total Variable costs	44285
Contribution margin	61015
Fixed costs:
Manufacturing	4600
Marketing	9600
Administrative	9400
Total Fixed costs	23600
Operating Profits	37415