Tyson's Hardware, a Retailing Company with Several Locations, Anticipated That

question 61

Essay

Tyson's Hardware, a retailing company with several locations, anticipated that it would have 96,000 sales units for 664 customer shipments. Average storage bin usage for various inventories was estimated to be 200 storage bins per day. The costs and cost drivers were determined to be as follows:
During the year the warehouse processed 90,000 units for 600 customer shipments. The workers used 225 storage bins on average each day to sort, store, and process goods for shipment. The actual costs for were:
Required:
a. Prepare a static-budget and show the static-budget variances for each cost item and the total static-budget variance.

---

Definitions:

Cost of Merchandise Sold

The direct costs attributable to the goods sold by a company, including the cost of the material and labor directly used in creating the goods.

Merchandising Company

A business that purchases finished goods for resale, making a profit on the sales margin.

Income Statement

A financial statement that reports a company's financial performance over a specific accounting period, highlighting revenue, expenses, and profits or losses.

Merchandise Inventory

Goods that a company holds with the intent to sell them as part of its business operations; considered a current asset on the balance sheet.