The Dinkle and Frizell Dental Clinic provides both preventive and orthodontic de
ID: 2451295 • Letter: T
Question
The Dinkle and Frizell Dental Clinic provides both preventive and orthodontic dental services. The two owners, Reese Dinkle and Anita Frizell, operate the clinic as two separate investment centers: Preventive Services and Orthodontic Services. Each of them is in charge of one of the centers: Reese for Preventive Services and Anita for Orthodontic Services. Each month, they prepare an income statement for the two centers to evaluate performance and make decisions about how to improve the operational efficiency and profitability of the clinic.
Recently, they have been concerned about the profitability of the Preventive Services operations. For several months, it has been reporting a loss. The responsibility report for the month of May 2017 is shown below.
In addition, the owners know that the investment in operating assets at the beginning of the month was $80,290, and it was $73,430 at the end of the month. They have asked for your assistance in evaluating their current performance reporting system.
Prepare a responsibility report for an investment center as illustrated in the chapter. (Round ROI to 1 decimal place, e.g. 1.5.)
These are the drop box options:
Exercise 10-18 The Dinkle and Frizell Dental Clinic provides both preventive and orthodontic dental services. The two owners, Reese Dinkle and Anita Frizell, operate the clinic as two separate investment centers: Preventive Services and Orthodontic Services. Each of them is in charge of one of the centers: Reese for Preventive Services and Anita for Orthodontic Services Each month, they prepare an income statement for the two centers to evaluate performance and make decisions about how to improve the operational efficiency and profitability of the clinic. Recently, they have been concerned about the profitability of the Preventive Services operations. For several months, it has been reporting a loss. The responsibility report for the month of May 2017 is shown below Difference from Budget Actual Service revenue $40,450 $1,260 Favorable Variable costs: Filling materials Novocain Supplies Dental assistant wages Utilities 120 Unfavorable 5,080 3,950 1,890 2,550 520 13,990 80 Unfavorable 420 Favorable -0- Neither Favorable nor Unfavorabl 100 Unfavorable 120 Favorable Total variable costs Fixed costs: Allocated portion of receptionist's salary 300 Unfavorable 490 Unfavorable 3,010 9,820 5,970 15,150 33,950 $(7,490 Dentist salary Equipment depreciation -0- Neither Favorable nor Unfavorabl Allocated portion of building depreciation Total fixed costs Operating income (loss) 1,130 Unfavorable 1,920 Unfavorable $540 Unfavorable In addition, the owners know that the investment in operating assets at the beginning of the month was $80,290, and it was $73,430 at the end of the month. They have asked for your assistance in evaluating their current performance reporting system Prepare a responsibility report for an investment center as illustrated in the chapter. (Round ROI to 1 decimal place, e.g. 1.5.)Explanation / Answer
Dinkle & Frizell Dental Clinic Preventive Services Responsibility report For the period ended May 2017 Particulars Budget Actual Favorable / Unfavorable Service Revenue 39,190 40,450 1,260 Favorable Variable costs Filling costs 4,960 5,080 120 Unfavorable Novocain 3,870 3,950 80 Unfavorable Supplies 2,310 1,890 420 Favorable Dental assistant wages 2,550 2,550 - N.a Utilities 420 520 100 Unfavorable Total Variable costs 14,110 13,990 720 Favorable Contribution Margin 25,080 26,460 1,380 Favorable Controllable Fixed costs Dentist Salary 9330 9820 490 Unfavorable Controllable Margin 15,750 16,640 890 Favorable Other fixed costs Allocated Portion of receptionists salary 2710 3010 300 Unfavorable Equipment depreciation 5970 5970 0 N.A Allocated portion of building depreciation 14020 15150 1130 Unfavorable Total other fixed costs 22700 24130 1430 Unfavorable Operating Income (Loss) (6,950) (7,490) 540 Unfavorable Return on Investment -8.7% -10.2% Unfavorable
Related Questions
drjack9650@gmail.com
Navigate
Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.