Joanne Graves Is Manager of a Production Department of Fordham

question 109

Essay

Joanne Graves is manager of a production department of Fordham Company.Her department makes one product;the following information for her department was accumulated for the current year: $\begin{array}{l}\begin{array}{|l|}\hline\\\hline \text {Number of units } \\\hline \text {Direct materials cost } \\\hline \text {Direct labor cost } \\\hline \text {Variable manufacturing overhead } \\\hline \text {Fixed manufacturing overhead} \\\hline \text { Total } \\\hline\end{array}\begin{array}{c|}\hline \text { Static Budget }\\\hline 100,000 \\\hline \$ 400,000 \\\hline 200,000 \\\hline 100,000 \\\hline \underline {145,000} \\\hline \$ 845,000 \\\hline\end{array}\begin{array}{c|}\hline \text { Actual Results }\\\hline \$ 94,000 \\\hline 380,000 \\\hline 185,000 \\\hline 94,000 \\\hline \underline {148,000} \\ \hline \$ 807,000 \\\hline\end{array}\end{array}$ Required:
1)Prepare a flexible budget for the department's actual level of activity.
2)Use the flexible budget to evaluate the performance of Ms.Graves' department.
3)Why does the budget not include sales revenue and net income?

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Definitions:

Coronary Heart Disease

A disease characterized by the narrowing or blockage of the coronary arteries, usually due to atherosclerosis, which can lead to heart attacks.

Competitive

Characterized by or involving rivalry between parties, each striving to outdo the other to achieve a goal or win a prize.

Aggressive

Exhibiting behavior that is assertive, often hostile, with the intention to dominate.

Hostility

A form of anger expression characterized by antagonistic attitudes and behaviors towards others.