Question
5. Flexible-budget preparation and analysis Bank Management Printers, Inc., produces luxury checkbooks with three checks and stubs per page. Each checkbook is designed for an
5. Flexible-budget preparation and analysis
Bank Management Printers, Inc., produces luxury checkbooks with three checks and stubs per page. Each checkbook is designed for an individual customer and is ordered through the customers bank. The companys operating budget for September 2015 included these data:
| Number of checkbooks | 15,000 |
| Selling price per book | $20 |
| Variable cost per book | $8 |
| Fixed costs for the month | $145,000 |
The actual results for September 2015 were as follows:
| Number of checkbooks | 12,000 |
| Selling price per book | $21 |
| Variable cost per book | $7 |
| Fixed costs for the month | $150,000 |
Prepare a static-budget-based variance analysis of the September performance
Prepare a flexible-budget-based variance analysis of the September performance
Why might Bank Management find the flexible-budget-based variance analysis more informative than the static-budget-based variance analysis?
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Intermediate Accounting
Authors: Donald E. Kieso, Jerry J. Weygandt, and Terry D. Warfield
15th edition
978-1118159644, 9781118562185, 1118159640, 1118147294, 978-1118147290
