Score: out of 15 Question #4 Acme Industries Actual Master Budget 1,050 Units Re

Question

Score: out of 15 Question #4 Acme Industries Actual Master Budget 1,050 Units Revenues Variable manufacturing cos 93,625 $ 93,450 Variable marketing costs 18,832 18,375 Contribution margin Fixed manufacturing costs 44,500 $ 45,000 Fixed marketing costs Fixed administrative costs 27,500 25,000 Operating profit 1,070 s 235,400 236,250 122,943 $ 124,425 31,500 30,000 s 19,443 24,425 Acme Company prepared a budget last period that called for sales of 1,050 units at an average price of $225 per unit. Variable manufacturing costs were budgeted to be $89.00 per unit and variable marketing costs were budgeted to be $17.50 per unit. Total fixed manufacturing, marketing, and administrative costs were budgeted to be $45,000, $30,000, and $25,000, respectively. During the period, actual sales totaled 1,070 units (units produced equaled units sold), and actual revenues totaled $235,400. Actual variable manufacturing costs were $93,625, and actual variable marketing costs were $18,832. Total fixed manufacturing costs were $44,500, total fixed marketing costs totaled $31,500, and total fixed administrative costs were $27500 5 1) Calculate Master Budget Variances. Show your work. 2) Prepare a Flexible Budget. Show your work. 3) Calculate Sales Volume Variances. Show your work. 4) Calculate Flexible Budget Variances. Show your work. Note: Be sure to indicate whether each variance is favorable or unfavorable.

Explanation / Answer

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Actual Master Budget Master Budget Variance Revenues 235400 236250 850 Unfavorable Variable manufacturing costs 93625 93450 175 Unfavorable Variable marketing costs 18832 18375 457 Unfavorable Contribution margin 122943 124425 1482 Unfavorable Fixed manufacturing costs 44500 45000 500 Favorable Fixed marketing costs 31500 30000 1500 Unfavorable Fixed administrative costs 27500 25000 2500 Unfavorable Operating profit 19443 24425 4982 Unfavorable

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