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Katy Company produces engine parts for the computer manufacturing company. The following table is the Katy’s...

Katy Company produces engine parts for the computer manufacturing company. The following table is the Katy’s performance report for the year 2016.

Actual Results

Flexible Budget

Master Budget

Sales Volume (in units)

1,900

2,000

Sales Revenues (in $)

$30,000

$32,000

Less: Variable Costs

15,500

15,000

Contribution Margin

Less: Fixed Costs

12,500

13,000

Operating Income

Required)

a) Fill out the blank cells with appropriate variance names or numbers. Also indicate if the variance is favorable (F) or Unfavorable (U) (20 points).

b) Explain the source of variances (5 pts)

Solutions

Expert Solution

ekkarill92 answered 2 years ago
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