Reference no: EM132418871

Problem: A bank manager of City Savings Bank Inc. uses the managerial accounting system to track the costs of operating the various departments within the bank. The departments include Cash Management, Trust, Commercial Loans, Mortgage Loans, Operations, Credit Card, and Branch Services. The static budget and actual results for the Operations Department are as follows:

The information provided by the budget are the resources and its amount for budget versus actual. For salaries, budget and actual number is $200,000. For benefits, budget and actual number is $30,000. For supplies, budget is $45,000 and actual number is $42,000. For travel, budget is $20,000 and actual number is $30,000. For training, budget is $25,000 and actual number is $35,000. For overtime, budget is $25,000 and actual number is $20,000. The total for budget is $345,000 and the total for actual number is $357,000. The excess of actual over budget is $12,000.

Required:

Question 1: What information is provided by the budget? Specifically, what questions can the bank manager ask of the Operations Department manager?

Question 2: What information does the static budget fail to provide? Specifically, could the budget information be presented differently to provide even more insight for the bank manager?