Bickel Corporation uses customers served as its measure of activity. The followi

Question

Bickel Corporation uses customers served as its measure of activity. The following report compares the planning budget to the actual operating results for the month of November:

Required:

Prepare the company's flexible budget performance report for November. Label each variance as favorable (F) or unfavorable (U). (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance) next to the variances columns. Input all amounts as positive values.)

Bickel Corporation Comparison of Actual Results to Planning Budget For the M nth Ended November 3 Actual Results Planning Budget Variances Customers served Revenue ($3.60q) Expenses: 44,000 $158,10e 43,000 $154, 80e $3,300 F Wages and salaries ($24, 300 $1.33q) Supplies $0.73q) Insurance ($6, 200) Miscellaneous expense ($5,200 $0.42q) 81,49e 31, 39e 6,200 23,260 142,340 1,330 u 1,600 F 82,820 29,790 6, 200 23, 1 141,910 $ 16,19e None 430 F $12,460 3,730 F Total expense Net operating income

Explanation / Answer

Flexible Budget Report is as prepared below:

Bickel Corporation Flexible Budget Performance Report For the month ended November 30 Particulars Actual Results Revenue and spending variances Flexible Budget Activity variances Planning Budget Actual-Flexible Planning-Flexible Customers Served $44,000 44,000 43,000 Revenue 158,100 ($300) U 158,400 3,600 F 154,800 Expenses: Wages and Salaries 82,820 $0 None 82,820 1,330 U 81,490 Supplies 29,790 ($2,330) F 32,120 730 U 31,390 Insurance 6,200 $0 None 6,200 0 None 6,200 Miscellaneous expense   23,100 ($580) F 23,680 420 U 23,260 Total expense 141,910 ($2,910) F 144,820 2,480 U 142,340 Net Operating Income 16,190 $2,610 F 13,580 1,120 F 12,460

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