The California Fitness Company completed the flexible budget analysis for the second quarter, which is given below.

	Actual Results	Flexible Budget Variance		Flexible Budget	Sales Volume Variance		Static Budget
Units	12,860	0		12,860	1,060	F	11,800
Sales Revenue	$62,720	$1,290	U	$64,010	$4,010	F	$60,000
Variable Costs	27,620	720	U	26,900	$1,700	U	25,200
Contribution Margin	$35,100	$2,010	U	$37,110	$2,310	F	$34,800
Fixed Costs	34,250	250	U	34,000	$0		34,000
Operating Income/(loss)	$850	$2,260	U	$3,110	$2,310	F	$800

Which of the following statements would be a correct analysis of the flexible budget variance for variable costs?

A.

decrease in sales price per unit

B.

increase in fixed costs

C.

increase in sales volume

D.

increase in variable cost per unit

The static budget, at the beginning of the month, for Steak Frites Companyfollows:

Static budget:

Sales volume: 1,100 units; Sales price: $70.00 per unit

Variable costs: $33.00 per unit; Fixed costs: $39,800 per month

Operating income: $900

Actual results, at the end of the month, follows:

Actual results:

Sales volume: 995 units; Sales price: $74.00 per unit

Variable costs: $35.00 per unit; Fixed costs: $35,000 per month

Operating income: $3,805

Calculate the sales volume variance for revenue.

A.

$7,350 U

B.

$3,885 U

C.

$4,800 U

D.

$3,980 F