Asked by
Ryley Jarvela
on Dec 16, 2024
Verified
Given below is an excerpt from a management performance report: Budget Actual Difference Contribution margin $600,000$580,000$20,000U Controllable fixed costs $200,000$220,000$20,000U\begin{array}{llll}&\text { Budget }&\text {Actual }&\text {Difference }\\\text { Contribution margin } & \$ 600,000 & \$ 580,000 & \$ 20,000 \mathrm{U} \\\text { Controllable fixed costs } & \$ 200,000 & \$ 220,000 & \$ 20,000 \mathrm{U}\end{array} Contribution margin Controllable fixed costs Budget $600,000$200,000Actual $580,000$220,000Difference $20,000U$20,000U The manager's overall performance
A) is 10% above expectations.
B) is 10% below expectations.
C) is equal to expectations.
D) cannot be determined from the information provided.
Management Performance Report
A document that evaluates and summarizes the effectiveness and efficiency of a company's management in achieving corporate objectives.
Controllable Fixed Costs
Fixed costs that management has the authority to increase or decrease, such as advertising expenses or research and development costs.
Contribution Margin
The amount by which a product’s selling price exceeds its variable costs, indicating how much contributes to covering fixed costs and generating profit.
- Examine the implications of deviations from the budget through the scrutiny of performance evaluations.
- Acquire knowledge about the interplay between responsibility accounting, controllable margins, and performance appraisal.
Verified Answer
NM
Learning Objectives
- Examine the implications of deviations from the budget through the scrutiny of performance evaluations.
- Acquire knowledge about the interplay between responsibility accounting, controllable margins, and performance appraisal.