The following information is available for Brownstone Products Company for the month of July:

Requirements
1. Set up a spreadsheet to Compute the July sales volume variance and flexible budget variance in terms of both contribution margin and operating income.
2. Discuss implications of these variances on strategic cost management for Brownstone.
3. Create a spreadsheet that will allow the firm to prepare pro forma budgets for activities within its relevant range of operations and prepare flexible budgets when sales are
a. 3,750 units.
b. 4,150 units.

Transcribed Image Text:

Problem Information Master Budget Actual Units Sales Revenue Selling price per unit Variable manufacturing costs Variable manufacturing costs per unit Fixed manufacturing costs Variable selling and administrative expense Variable selling and administrative expense per unit Fixed selling and adminstrative expense 4,0003,800 S60,000 S53,200 S15.00$14.00 S16,000S19,000 S4.00 S5.00 $15,000 S16,000 $8,000$7,700 $2.00000 S2.02632 $9,000 S10,000