Reference no: EM132524525

TACC 607 Managerial Accounting - Australian National Institute of Management and Commerce

Read carefully the following Case information before planning to write the Report

Case - Fantastic Sky Tours Pty Ltd

Assignment Tasks and Report Requirements

Assuming the role of Miranda Jenkins at Fantastic Sky Tours Pty Ltd, prepare a report to the owner of the company providing explanations and revised reports in relation to the operating performance in April 2020, and address her ethical obligations arising from the response from the manager of Aircraft Operations. Your report should contain the following three parts:

Section I

Question 1. Explain why the company's April net profit was only about two-thirds of the expected level, despite several favourable variable expense variances shown in the above performance report.

Question 2. Explain why the original performance/variance report prepared by the manager of Aircraft Operations is misleading.

Section II

Question 1. Prepare flexible budgets for the company based on the following activity levels:
(a) 32 000 air-kilometres.
(b) 35 000 air-kilometres.
(c) 38 000 air-kilometres.

Question 2. Prepare a revised performance report showing the proper variances for April, based on the flexible budget that you prepared above.

Section III

Miranda Jenkins presented her revised performance report to Robert Smith, along with the explanation why the original performance report was misleading. Robert did not take it well. He complained of Miranda's ‘interference' and pointed out that the company had been doing just fine without her. ‘I am taking my report to the owner tomorrow,' Robert insisted. ‘Yours just makes us look bad.'

What are Miranda's ethical obligations as a CPA in this matter? What should she do?

Attachment:- Managerial Accounting.rar