Precious Bubbles, Inc. Income Statement Performance Report For the month ended August 31 Flexible Budget Variance Flexible Budget Volume Variance Master Budget Output units Sales revenue Variable expenses: Cost of goods sold Sales commissions expense Utility expense Fixed expenses: Salary expense Depreciation expense Rent expense JU 000 DIDO Utility expense Choose from any list or enter any number in the input fields and then continue to the next question. Rent expense Uity expense Total expenses Operating income Requirement 2. What accounts for most of the difference between actual perting income and master budget operating income? The for operating income is larger than the Most of the difference between master budgetering income and actual bubble kits than expected Requirement 3. What is Precious Bubbles master budget variance? Explain why the income statement performance report provides Precious B r o t her insights can Precious Bubbles managers draw from this performance report? Precious Bubbles master budget variance is $ . meaning that its aperiting income than expected com o Choose two reasons why the income statement performance report provides Precious Bubbles managers with more information than the simple master budget variance These variances suggest that the marketing department did a job by selling is than expected, ta l e price than expected. Choose from any ist or enter any number in the input fields and then continue to the ned question. 6 of 10 (4 complete) Remaining: 01:01:39 Submit Test This Test: 10 pts possible wedd Data Table come was as follows: Month Ended August 31 Data Table Flexible Budget per Output Unit Output Units (Kits) 65,000 70,000 75,000 $ 191,750 $ 206,500 $ 221,250 214,750 2.95 Precious Bubbles, Inc. Income Statement Month Ended August 31 Sales revenue $ Variable expenses: Cost of goods sold Sales commissions Uulity expense T L Sales revenue Variable expenses: Cost of goods sold Sales commissions Utility expense Fixed expenses: Salary expense Depreciation expense Rent expense 1.20 0.25 0.15 78,000 16,250 9,750 84,000 7,500 10.500 84,600 20,600 10,500 90.000 18.750 11.250 Foed expenses 33,000 18,000 9,000 6.000 170,000 $ 21,750 $ 33,000 36,300 18,000 20,700 9,000 13,000 6.000 6.000 178,000 $ 196,000 28,500 $ 25.250 Salary expense Depreciation expense Rent expense Ulity expense Total expenses.... Operating income 35.100 18,000 8.050 6,000 182,850 Utility expense 31.900 Total expenses $ $ Operating income Print Done Print Done Operating income i Requirements 2.99 1.20 0.25 0.15 1. Prepare an income statement performance report for August. Note: The master budget was based on expected sales volume of 65,000 bubble kits. 2. What accounts for most of the difference between actual operating income and master budget operating income? 3. What is Precious Bubbles' master budget variance? Explain why the income statement performance report provides Precious Bubbles managers with more useful information than the simple master budget variance. What insights can Precious Bubbles' managers draw from this performance report? Print Done These variances suggest that the marketing department did a v job by Operating income