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Problem 22-5A (Part Level Submission) Optimus Company manufactures a variety of...

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Accounting

Problem 22-5A (Part Level Submission)

Optimus Company manufactures a variety of tools and industrial equipment. The company operates through three divisions. Each division is an investment center. Operating data for the Home Division for the year ended December 31, 2017, and relevant budget data are as follows.

Actual Comparison with Budget

Sales $1,400,000 $101,000 favorable

Variable cost of goods sold 675,000 55,000 unfavorable

Variable selling and administrative expenses 126,000 25,000 unfavorable

Controllable fixed cost of goods sold 170,000 On target

Controllable fixed selling and administrative expenses 81,000 On target

Average operating assets for the year for the Home Division were $1,999,000 which was also the budgeted amount.

(a)

Prepare a responsibility report for the Home Division. (List variable costs before fixed costs. Round ROI to 1 decimal place, e.g. 1.5.)

OPTIMUS COMPANY

Home Division

Responsibility Report

For the Year Ended December 31, 2017

Budget Actual FavorableUnfavorableNeither Favorablenor Unfavorable

$ $

$

$

$

ROI

%

%

%

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