Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

b) Dub's Records Stuff estimates its sales for the upcoming period and prepared the following budget: Units 25,000 Sales $20 Less variable costs: Manufacturing costs

  1. b) Dub's Records Stuff estimates its sales for the upcoming period and prepared the following budget:

Units

25,000

Sales

$20

Less variable costs:

Manufacturing costs

$3

Selling and administrative costs

$2

Contribution margin

$15

Less fixed costs:

Manufacturing costs

$14,000

Selling and administrative costs

$12,000

Net income

TBD

Assuming the manager produced 190K in sales, 110K of total variable costs and 14K for total fixed costs for 15,000 units. Of these variable costs, 40K related to selling and administrative costs. Comment if these are favourable or unfavourable. Make sure to use full dollar impacts so it is clear to management the magnitude of any variances. Comment on if the manager has had a successful year.

  1. 1) The flex budget method (Give full values vs. per unit)

  2. 2) The static budget method (Give full budget vs. per unit)

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Fundamental Accounting Principles

Authors: John J. Wild, Ken W. Shaw, Barbara Chiappetta

20th Edition

1259157148, 78110874, 9780077616212, 978-1259157141, 77616219, 978-0078110870

More Books

Students also viewed these Accounting questions