QUESTION 1

1. The actual information pertains to the month of August. As part of the budgeting process, Alloway's Fencing Company developed the following static budget for August. Alloway is in the process of preparing the flexible budget and understanding the results.

   	Actual Results	Flexible budget	Static Budget
   Sales Volume (in units)	10,000		13,000
   Sales Revenue	$1,100,000		$1,201,200
   variable Costs	512,000		600,600
   Contribution Margin	588,000		600,600
   Fixed Costs	458,000		450,000
   operating profit	130,000		150,600

   What is the flexible variance for revenue?

4 points

QUESTION 2

1. The actual information pertains to the month of August. As part of the budgeting process, Alloway's Fencing Company developed the following static budget for August. Alloway is in the process of preparing the flexible budget and understanding the results.

   	Actual Results	Flexible budget	Static Budget
   Sales Volume (in units)	10,000		12,000
   Sales Revenue	$1,000,000		$1,201,200
   variable Costs	420,000		600,600
   Contribution Margin	580,000		600,600
   Fixed Costs	450,000		450,000
   operating profit	130,000		150,600

   What is the flexible variance for variable costs?