Question
Complete the following flexible budget and Give one possible explanation for each of the variances. Master Budget Flexible budget Actual Results Sales volume (in units)
Complete the following flexible budget and Give one possible explanation for each of the variances.
Master Budget | Flexible budget | Actual Results | |||||
Sales volume (in units) | 20,000 | 18,500 | |||||
Sales Revenue | $1,050,000 | $972,000 | |||||
Variable costs | 500,000 | 477,000 | |||||
Contribution margin | 550,000 | 495,000 | |||||
Capacity-related (fixed) costs | 380,000 | 385,000 | |||||
Operating profit | $170,000 | $110,000 |
Step by Step Solution
3.42 Rating (158 Votes )
There are 3 Steps involved in it
Step: 1
Based on the given data we can calculate the variances for the flexible budget and compare them to t...
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started
Management Accounting
Authors: Charles T. Horngren, Gary L. Sundem, William O. Stratton, Phillip Beaulieu
6th Canadian edition
013257084X, 1846589207, 978-0132570848
