Data Table The budgeted amounts for September 2017 were: 19,000 22 Number of checkbooks Selling price per book Variable cost per book Fixed costs for the month $ $ $ 150,000 The actual results for September 2017 were as follows: Number of checkbooks produced and sold Average selling price per book Variable cost per book Fixed costs for the month $ $ $ 15,800 23 9 156,500 Print Done 0 Requirements 1. Prepare a static-budget-based variance analysis of the September performance. 2. Prepare a flexible-budget-based variance analysis of the September performance. 3. Why might Finance Assistant find the flexible-budget-based variance analysis more informative than the static-budget-based variance analysis? Explain your answer. Print Done Finance Assistant 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 customer's bank. The company's operating budget for September 2017 included these data: (Click the icon to view the operating budget and actual results.) The executive vice president of the company observed that the operating income for September was much lower than anticipated, despite a higher-than-budgeted selling price and a lower-than-budgeted variable cost per unit. As the company's management accountant, you have been asked to provide explanations for the disappointing September results. Finance Assistant develops its flexible budget on the basis of budgeted per-output-unit revenue and per-output-unit variable costs without detailed analysis of budgeted inputs. Read the requirements. Requirement 1. Prepare a static-budget-based variance analysis of the September performance. Begin with the actual results, then compute the static budget and the static-budget variances. Label each variance as favorable or unfavorable. (Enter an operating loss with a minus sign or parentheses.) Actual Static-Budget Variances Static Budget Results Units sold Revenues Variable costs Contribution margin Fixed costs Operating income (loss) Requirement 2. Prepare a flexible-budget-based variance analysis of the September performance. Begin with the actual results, then complete the flexible budget columns and the static budget columns. Label each variance as favorable or unfavorable. (For variances with a $0 balance, make sure to enter "0" in the appropriate field. If the variance is zero, do not select a label. Enter operating losses with a minus sign or parentheses.) Actual Flexible-Budget Variances Flexible Budget Sales-Volume Variances Static Budget Results Units sold Revenues Variable costs Contribution margin Fixed costs Operating income (loss) Requirement 3. Why might Finance Assistant find the flexible-budget-based variance analysis more informative than the static-budget-based variance analysis? Requirement 3. Why might Finance Assistant find the flexible-budget-based variance analysis more informative than the static-budget-based variance analysis? The flexible-budget the static-budget variance. This allows the managers to see the portion of the variance that arose because sales price and costs were either higher or lower than expected, as shown in the column, and the portion of the variance that arose because the sales volume was different than expected, as shown in the column. actual selling price from the budgeted price. Variable costs relative to the flexbile The primary reason for the budget, which could be due to static-budget variance is the management or using in unit volume. One explanation for this change is the quality materials. Choose from any list or enter efficient input fields and then continue to the next question. inefficient Save for Later
