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Exercise 22-11 Service and Business Internet Service. Each segment is run by its

ID: 2572611 • Letter: E

Question

Exercise 22-11 Service and Business Internet Service. Each segment is run by its own supervisor, while basic selling and administr Lenny has asked you to help him create a performance been collected on the Home Internet Service segment for the first quarter of 2017 manociis utt reporting system that will allow him to mesure each sgnents parismance i temtyl 0tato $25,000 $26,600 Allocated portion of Building depreciation 11,000 11,000 4,8004,600 3,500 2,800 1,100 1,000 1,500 1,300 8,900 9,700 3,500 3,500 2,900 3,500 3,100 3,300 1,700 1,500 Billing Property taxes salaries Insurance Wages Gas and oil Equipment depreciation bility report for the first quarter of 2017 for the Home Internet Service Segment March 31, 2017 Unfavorable Neither Favorable

Explanation / Answer

UrLink Company

Responsibility Report

UrLink Company

Home Internet Services Segment

Responsibility Report

For the Quarter Ended March 31, 2017

Budgeted

Actual

Difference

F/UF/ Neither

Sales

$25,000

$26,600

$1,600 F

Variable Costs:

Materials and Supplies

$1,500

$1,300

$200 F

Wages

$2,900

$3,500

$600 UF

Gas and oil

$3,100

$3,300

$200 UF

Total Variable Cost

$7,500

$8,100

$600 UF

Contribution Margin

$17,500

$18,500

$1,000 F

Controllable Fixed Costs:

Supervisory Salary

$8,900

$9,700

$800 UF

Insurance

$3,500

$3,500

0

Equipment Depreciation

$1,700

$1,500

$200 F

Total Controllable Fixed Costs

$14,100

$14,700

$600 UF

Controllable Margin

$3,400

$3,800

$400 F

Notes:

UrLink Company

Home Internet Services Segment

Responsibility Report

For the Quarter Ended March 31, 2017

Budgeted

Actual

Difference

F/UF/ Neither

Sales

$25,000

$26,600

$1,600 F

Variable Costs:

Materials and Supplies

$1,500

$1,300

$200 F

Wages

$2,900

$3,500

$600 UF

Gas and oil

$3,100

$3,300

$200 UF

Total Variable Cost

$7,500

$8,100

$600 UF

Contribution Margin

$17,500

$18,500

$1,000 F

Controllable Fixed Costs:

Supervisory Salary

$8,900

$9,700

$800 UF

Insurance

$3,500

$3,500

0

Equipment Depreciation

$1,700

$1,500

$200 F

Total Controllable Fixed Costs

$14,100

$14,700

$600 UF

Controllable Margin

$3,400

$3,800

$400 F