Reference no: EM132516446

Greene Enterprises prepares monthly departmental reports in an effort to control its operating costs. Each department has a manager to whom the report is addressed and who is held responsible for the operating results in his or her department. The report made to Department D for October follows:

                             Budgeted                    Actual

Sales                       $56,000                  $63,000

Costs of goods sold     39,200               37,800

Gross margin                 16,800              25,200

Direct operating expenses* 16,720                18,000

Contribution to indirect expense $80                  $7,200

• *of which $10,000 are costs not varying directly with sales volume at the expected level of sales.

Required:

Question 1: Can you make a report that will be of more value in analyzing and appraising the performance of the manager of Department D for October and comment on the operating results?