4 Phoenix Company\'s 2017 master budget included the following fixed budget repo
ID: 2511332 • Letter: 4
Question
4 Phoenix Company's 2017 master budget included the following fixed budget report it is based on an expected production and sale volume of 17,000 units 1.25 4,250,000 105,000 Machinery repairs (variable cost 2,220,000 Gross profit Shipping 102.000 270,000 440,000 ales salary (tixed annoal anount) al and adainiatrati Advertising expense Salaries 253,00 from operat.lona 1.212.000 Phoenix Company's actual income statement for 2017 follows Statenent of Incone from Operations 55,063,00 of goods sold Groas profit MacBook A ?? 4Explanation / Answer
Flexible Budget performance report Flexible Budget Actual result Variance sales 5000000 5063000 63000F variable expense Direct material 1300000 [1105000*20000/17000] 1316000 16000 U Direct labor 400000 409000 9000 U Machinery repairs 60000 51000 9000 F Utilities 40000 [34000*20000/17000] 39250 [196750-157500] 750 F Packaging 80000 [68000*20000/17000] 77500 2500 F shipping 120000 [102000*20000/170000] 112000 8000 F Total variable cost 2000000 2004750 4750 U contribution margin 3000000 3058250 58250 F fixed cost depreciation 315000 315000 0 NA Utilities 160000 [194000-34000] 157500 2500 F plant management salaries 215000 226000 11000 U sales salary 270000 288000 18000 U Advertising expense 127000 135000 8000 U salaries 253000 251000 2000 F entertainment expense 100000 103500 3500U Total fixed cost 1440000 1476000 36000 U income from operations 1560000 1582250 22250 F
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