Question
Dancin' Donuts, established in January 2019, is a thriving new business specializing in low-carb donuts. The 2019 keto diet fad led to increased sales, and
Dancin' Donuts, established in January 2019, is a thriving new business specializing in low-carb donuts. The 2019 keto diet fad led to increased sales, and the chief financial officer (CFO) prepared a robust budget for 2020. In early March 2020, the small business had record-breaking sales but abruptly needed to shut its doors because of the global pandemic. The CFO conducted the following analysis for the month of March:
Dancin' Donuts March 2020 | ||||||||
| Budget | Actuals | $ Var | % | ||||
| Total Revenue | 200,000 | 196,947 | -3,053 | -2% | |||
| Total Cost of Goods Sold | 100,000 | 98,000 | -2,000 | -2% | |||
| GROSS PROFIT | 100,000 | 98,947 | -1,053 | -1% | |||
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| Total Expense | 75,000 | 72,000 | -3,000 | -4% | |||
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| Total Interest Income | 200 | 100 | -100 | -50% | |||
| Total Other Expense | 1,000 | 1,000 | 0 | 0% | |||
| -800 | -900 | -100 | 13% | ||||
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Earnings Before Interest, Taxes, Depreciation, & Amortization (EBITDA) | 24,200 | 26,047 | 1,847 | 8% | ||||
| Total Interest Expense | 6,400 | 6,385 | -15 | 0% | |||
| Total Depreciation & Amortization | 10,000 | 10,000 | 0 | 0% | |||
Earnings Before Taxes (EBT) | 7,800 | 9,662 | 1,862 | 24% | ||||
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| Total Income Taxes (30%) | 2,340 | 2,899 | 559 | 24% | |||
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Net Income | 5,460 | 6,764 | 1,304 | 24% |
Please answer the following questions:
- What does AVB stand for?
- What is the total revenue for March 2020 when compared to the budget?
- What is the variance from the budget in the net income for the month?
- What is the income tax percentage for the month?
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