The following table contains a hypothetical partial master budget performance re
ID: 2414400 • Letter: T
Question
The following table contains a hypothetical partial master budget performance report for OrganicOrganic Fudge Company.
Fill in the missing amounts. Be sure to indicate whether variances are favorable (F) or unfavorable (U).
Flexible Budget Flexible Volume Variance Actual Variance Budget Master Budget Sales volume (number of cases sold) 13,400 13,400 12,100 Sales revenue ($28 per case) $368,700 $ 375,200 338,800 Less variable expenses Sales expense ($4 per case sold) Shipping expense ($2 per case sold) 50,800 26,300 291,600 $ 53,600 26,800 294,800 48,400 24,200 266,200 Contribution margin Less fixed expenses 10,200 3,500 $277,900 8,800 3,500 $ 282,500 8,800 3,500 253,900 Salaries Office rent Operating incomeExplanation / Answer
Actual
Flexible budget variance = actual-flexible budget
Fav or UnFAV
flexible budget
sales revenue
368700
-6500
Unfav
375200
sales expenses
50800
-2800
F
53600
shipping expense
26300
-500
F
26800
contribution margin
291600
-3200
Unfav
294800
Actual
Volume variance = actual-master budget
Fav or UnFAV
master budget
sales revenue
368700
29900
F
338800
sales expenses
50800
2400
Unfav
48400
shipping expense
26300
2100
Unfav
24200
contribution margin
291600
25400
F
266200
Actual
Flexible budget variance = actual-flexible budget
Fav or UnFAV
flexible budget
sales revenue
368700
-6500
Unfav
375200
sales expenses
50800
-2800
F
53600
shipping expense
26300
-500
F
26800
contribution margin
291600
-3200
Unfav
294800
Actual
Volume variance = actual-master budget
Fav or UnFAV
master budget
sales revenue
368700
29900
F
338800
sales expenses
50800
2400
Unfav
48400
shipping expense
26300
2100
Unfav
24200
contribution margin
291600
25400
F
266200
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