illie Whitehorse, the plant manager of Travel Free’s Indiana plant, is responsible for all of that plant’s costs other than her own salary. The plant has two operating departments and one service department. The camper and trailer operating departments manufacture different products and have their own managers. The office department, which Whitehorse also manages, provides services equally to the two operating departments. A budget is prepared for each operating department and the office department. The company’s responsibility accounting system must assemble information to present budgeted and actual costs in performance reports for each operating department manager and the plant manager. Each performance report includes only those costs that a particular operating department manager can control: raw materials, wages, supplies used, and equipment depreciation. The plant manager is responsible for the department managers’ salaries, utilities, building rent, office salaries other than her own, and other office costs plus all costs controlled by the two operating department managers. The annual departmental budgets and actual costs for the two operating departments follow.  

 Budget Actual
 
 
 Campers  Trailers Combined Campers  Trailers Combined
  Raw materials$195,200   $276,400   $471,600   $194,600   $274,400   $469,000  
  Employee wages 105,400    205,400    310,800    107,400    207,000    314,400  
  Dept. manager salary 43,900    52,000    95,900    44,300    53,200    97,500  
  Supplies used 33,800    91,000    124,800    31,400    91,300    122,700  
  Depreciation—Equip. 61,000    126,500    187,500    60,600    126,500    187,100  
  Utilities 4,400    5,400    9,800    3,600    5,900    9,500  
  Building rent 5,400    9,000    14,400    5,900    9,200    15,100  
  Office department costs 68,750    68,750    137,500    70,550    70,550    141,100  
 

 

 

 

 

 

  Totals$517,850   $834,450   $1,352,300   $518,350   $838,050   $1,356,400  
 



 



 



 



 



 




 

The office department’s annual budget and its actual costs follow.

 

 Budget Actual
  Plant manager salary$82,000   $84,000  
  Other office salaries 32,500    26,500  
  Other office costs 23,000    30,600  
 

 

  Totals$137,500   $141,100  
 



 




 

Required:
1.

Prepare responsibility accounting performance reports that list costs controlled by the following. In each report, include the budgeted and actual costs and show the amount that each actual cost is over or under the budgeted amount.

 

a.Manager of the camper department.
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