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xxMikexx [17]
2 years ago
13

Optimus Company manufactures a variety of tools and industrial equipment. The company operates through three divisions. Each div

ision is an investment center. Operating data for the Home Division for the year ended December 31, 2020, and relevant budget data are as follows. Actual Comparison with Budget Sales$1,399,000$100,000 favorable Variable cost of goods sold680,00056,000 unfavorable Variable selling and administrative expenses125,00025,000 unfavorable Controllable fixed cost of goods sold169,000On target Controllable fixed selling and administrative expenses81,000On target Average operating assets for the year for the Home Division were $2,000,000 which was also the budgeted amount. (a) Prepare a responsibility report for the Home Division. (List variable costs before fixed costs. Round ROI to 2 decimal places, e.g. 1.57%.) OPTIMUS COMPANY Home Division Responsibility Report For the Year Ended December 31, 2020 Difference Budget Actual Favorable Unfavorable Neither Favorable nor Unfavorable $ $ $ $ $ $ ROI % % %
Business
1 answer:
PIT_PIT [208]2 years ago
3 0

Answer:

OPTIMUS COMPANY

Home Division Responsibility Report For the Year Ended December 31, 2020

The report is attached in form of a variance report with comments.  Where the variance is not indicated, it means that it was neither favorable nor unfavorable.

Explanation:

A responsibility report is usually presented by a division that is an investment center.  An investment center has responsibility for return on investments.

The investment center takes charge of the cost, revenue, profit, and investments of the division.  It is expected to produce returns on its investment that will be favorable to the shareholders of the company.  It is directly responsible for profitability of the division vis-a-vis the capital investments made in the center.  It is unlike other divisions like cost center, revenue center, and profit center, which narrowly report their performances in accordance with their responsibilities.

This is why it does not only report on the cost, but also the revenue, the profit and the returns on investment achieved during a period.  An investment center is, therefore, the largest division of an entity.

Download xlsx
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Answer:

The correct answer is A.

Explanation:

Giving the following information:

June 1: $780/150 units= $5.2 per unit

June 10: $1,170/200 units= $5.85 per unit

June 15: $1,260/200= $6.3 per unit

June 28: $990/150= $6.6 per units

A physical count of merchandise inventory on June 30 reveals that there are 210 units on hand.

Units sold= total units - ending inventory

Units sold= (150 + 200 + 200 + 150) - 210= 490 units

<u>The method with the lowest cost of goods sold will have the highest income:</u>

FIFO (first-in, first-out):

COGS= 150*5.2 + 200*5.85 + 140*6.3= $2,832

LIFO /last-in, first-out)

COGS= 150*6.6 + 200*6.3 + 140*5.85= $3,069

Weighted-average:

Weighted-average price= (5.2 + 5.85 + 6.3 + 6.6)/4= 5.99

COGS= 490*5.99= $2,935.1

The inventory method that will provide the highest gross profit is FIFO.

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3 years ago
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Answer:

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Explanation:

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Answer:

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Explanation:

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