Chapter 21: Serial Problem

Serial Problem: Business Solutions - Flexible Budget Performance Report 1. Prepare a Flexible Budget Performance Report: o Separate fixed and variable expenses in the report. o Compare actual results with the budgeted results for the computer furniture operations in Q2 of 2022. Check: The fixed expenses variance should show $1,000 unfavorable (U). Tableau Dashboard Activities (Tableau DA 21-1 to DA 21-3) 1. Compute Unit and Total Cost Variances: o Activity DA 21-1: Compute standard unit cost and total cost variance. o Activity DA 21-2: Calculate direct materials variances. o Activity DA 21-3: Analyze direct labor and overhead variances. These tasks use Connect and provide a visualization of variances without needing Tableau software. Company Analysis: Sales Variance for Apple (AA 21-1) 1. Compute Sales Variances: o Calculate the sales price and volume variances based on assumed data for Apple’s college discounts. o Identify if each variance is favorable or unfavorable. o Determine if the total variance is favorable or unfavorable. 2. Comparative Analysis: Sales Growth Rates for Apple and Google (AA 21-2): o Compute each company’s sales growth rate. o Project future sales for each company’s product segment assuming the same growth rates continue. Extended Analysis: Samsung Sales Variance Analysis (AA 21-3) 1. Calculate Sales Price and Volume Variances: o Using assumed data, calculate sales price and volume variances for a Samsung television model. o Identify each as favorable or unfavorable and assess the total sales variance. Discussion Questions 1. Cost Control Limitations of Fixed Budgets: Why fixed budget performance reports may be less effective for controlling costs. 2. Purposes of Flexible Budgets: Explain the two main purposes of using flexible budgets. 3. Flexible Budget Cost Formula: The formula to calculate total budgeted costs for various activity levels. 4. Flexible Budget Performance Reporting: Types of analysis that flexible budget performance reports enable. 5. Management by Exception: How standard costs assist managers in identifying areas needing attention. 6-9. Labor Variances: • • Departments typically responsible for direct labor rate and efficiency variances. Definitions of price variance and quantity variance, and their purpose. 10-16. Overhead Variance Analysis: • • • Definitions of volume variance, controllable variance, and standard overhead rate. How flexible budget reports help management apply management by exception. Application of flexible budgets by advertising sales managers at Google, Apple, and Samsung. 17. Standard Costing Systems: List two positive and two negative aspects of standard costing systems. Beyond the Numbers: Ethics Challenge (BTN 21-1) 1. Setting Standards for a New Product: o Select three types of specialists to set standards for a new warehouse robot. o Explain each specialist's role in determining materials price and quantity standards. Communicating in Practice (BTN 21-2): Memorandum on Variance Accounts 1. Explain Favorable and Unfavorable Variances: o Effects of favorable and unfavorable variances on Cost of Goods Sold (COGS) and income. o Clarify the meaning of favorable and unfavorable variances in accounting terms. Teamwork in Action (BTN 21-3): Service Industry Time Standards 1. Identify Time-Based Competitive Advantage in Service Industries: o In teams, choose two service industries. o Discuss time elements these industries use to gain competitive advantage. Entrepreneurial Decision (BTN 21-4): Memo for True Fit 1. Interpret Variance Comments for True Fit: o Explain that variances are not sufficient explanations on their own and that management’s goal is not solely to minimize variances. o Contextualize these statements for True Fit's business approach in standard costing and variance analysis. This outline organizes each part of the assignment, focusing on the analytical and reporting tasks, variance calculations, and theoretical questions related to variance, cost control, and standard costing. Use this as a guide to ensure each requirement is met comprehensively.