Extreme SportsSubunit X Revenue by Product Flexible Budget Variance Sales Volume Variance Flexible Budget Static (Master) Budget Actual Downhill Model R.. $ 327,000 $ 16,000 F $ 301,000 Downhill Model RII 150,000 281,000 $ 1,000 U $ 165,000 282,000 Cross-Country Model EXI Cross-Country Model EXII 143,000 299,000 267,500 408,000 247,000 20,500 U 256,000 430,000 1,000 Snowboard Model LXI. F $ 1,444,000 $ 1,418,500 Total Requirements 1. Complete the performance evaluation report for this subunit. 2. Based on the data presented, what type of responsibility centre is this subunit? 3. Which items should be investigated if part of management's decision criteria is to investigate all variances exceeding $16,000? Interpret your results. (What could cause these variances? What impact might these variances have on company inventory levels and operations?) Requirement 1. Complete the performance evaluation report for this subunit. (Enter the variances as a positive numbers. Label each variance as favourable (F) or unfavourable (U).) Extreme SportsSubunit X Revenue by Product Flexible Budget Variance Flexible Budget Sales Volume Variance Static (Master) Budget Actual Downhill Model RI. $ 327,000 $ 16,000 F $ 301,000 Downhill Model RII $ 150,000 $ 165,000 $ 143,000 $ 281,000 $ 1,000 U $ 282,000 $ 299,000 Cross-Country Model EXI Cross-Country Model EXII $ $ 247,000 $ 20,500U $ 256,000 430,000 $ 267,500 408,000 $ 1,000 $ Snowboard Model LXI. F $ 1,444,000 $ 1,418,500 Total Roguirmont 2 Ronnd on the Bronted what franonibilitaantreitbinubuito Requirement 2. Based on the data presented, what type of responsibility centre is this subunit? This subunit is a(n) Requirement 3. Which items should be investigated if part of management's decision criteria is to investigate all variances exceeding $16,000? Using the flexible budget variance as a guide, which of the following items will be investigated? (Select all that apply.) A. Downhill Model RI B. Cross-Country Model EXII C. Cross-Country Model EXI D. Downhill Model RII E. Snowboard Model LXI OF. None of the items should be investigated. Using the sales volume variance as a guide, which of the following items will be investigated? (Select all that apply.) A. Cross-Country Model EXII B. Cross-Country Model EXI C. Downhill Model RII D. Snowboard Model LXI O E. Downhill Model RI OF. None of the items should be investigated. Interpret your results. (What could cause these variances? What impact might these variances have on company inventory levels and operations?) The sales volume variance Therefore, was different than budgeted for This could result in every model. The company sales mix appears to be shifting in the direction of inventory Management may need to do a better job marketing their Additionally, the company may end up with if production schedules are not revised to accommodate the increasing demand for
