Solitaire Company’s fixed budget performance report for June follows. The $311,2

Question

Solitaire Company’s fixed budget performance report for June follows. The $311,250 budgeted expenses include $249,000 variable expenses and $62,250 fixed expenses. Actual expenses include $68,850 fixed expenses.

Prepare a flexible budget performance report showing any variances between budgeted and actual results. List fixed and variable expenses separately.

Fixed Budget Actual Results Variances Sales (in units) 8,300 10,700 Sales (in dollars) $ 415,000 $ 535,000 $ 120,000 F Total expenses 311,250 374,500 63,250 U Income from operations $ 103,750 $ 160,500 $ 56,750 F

Explanation / Answer

Flexible budget Actual results Variances Fav./Unf. Sales 535000 535000 0 None Variable expenses 321000 305650 15350 Favorable Contribution margin 214000 229350 15350 Favorable Fixed expenses 62250 68850 6600 Unfavorable Income from operations 151750 160500 8750 Favorable

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