Question

Classic Products Company manufactures colonial style desks. Some of the​ company's data was misplaced. Use the following information to replace the lost​ data:

	Actual Results	Flexible Budget Variances	Flexible Budget	Sales−Volume Variances	Static Budget
Units sold	​490,000		​490,000		​448,350
Revenues	​$187,250	​$5,000 F	​(A)	​$6,260 U	​(B)
Variable costs	​(C)	​$890 U	​$71,260	​$10,800 F	​$82,060
Fixed costs	​$36,670	​$3,740 F	​$40,410	0	​$40,410
Operating income	​$78,430	​(D)	​$70,580	​(E)	​$66,040

What amounts are reported for revenues in the flexible−budget (A) and the static−budget (B), respectively?

Answer 1

The table will be completed in the following manner:

Workings & Rationale

A flexible budget variance is favorable when

Actual revenues > Flexible Budget Revenues

Actual expenses < Flexible Budget Revenues

A Sales volume variance is favorable when

Flexible Budget Revenues > Static Budget Revenues

Flexible Budget expenses < Static Budget expenses

Please hit LIKE button if this helped. For any further explanation, please put your query in comment, will get back to you.