34. Sales volume variance analysis. Budgeted sales and variable costs for Brook Electronics for the year...

34. Sales volume variance analysis. Budgeted sales and variable costs for Brook Electronics
for the year were as follows:
Total Sales Total Variable Costs
Product X (5,000 units) ....................................................... $ 50,000 $ 20,000
Product Y (200 units).......................................................... 10,000 8,000
Product Z (50,000 units)...................................................... 125,000 75,000
Total Budgeted ............................................................... $185,000 $103,000
Actual sales for the period were as follows:
Product X (5,300 units)............................................................................................... $ 55,650
Product Y (240 units) ................................................................................................. 11,520
Product Z (48,000 units) ............................................................................................. 96,000
Total Actual Sales ................................................................................................... $163,170
Prepare a variance report to show the difference between the master budget and the
?exible budget for each of the three products

Expert Solution

Solution:

Computation Budgeted sale price for Sale and Variable cost
	Product X	Product Y	Product Z
Sales revenue	$50,000.00	$10,000.00	$125,000.00
Variable Costs	$20,000.00	$8,000.00	$75,000.00
Sale Units	5000	200	50000
Sale Price per unit	10	50	2.5
variable cost per unit	4	40	1.5

Variance Report between master budget and flexible budget
	Product X
Particulars	Master Budget	Flexible Budget	Variance
Sales units	5000.00	5300.00
Sales Revenue	$50,000.00	$53,000.00	$3,000.00	Favourable
Variable cost	$20,000.00	$21,200.00	$1,200.00	Unfavourable

Variance Report between master budget and flexible budget
	Product Y
Particulars	Master Budget	Flexible Budget	Variance
Sales units	200.00	240.00
Sales Revenue	$10,000.00	$12,000.00	$2,000.00	Favourable
Variable cost	$8,000.00	$9,600.00	$1,600.00	Unfavourable

Variance Report between master budget and flexible budget
	Product Z
Particulars	Master Budget	Flexible Budget	Variance
Sales units	50000.00	48000.00
Sales Revenue	$125,000.00	$120,000.00	-$5,000.00	Unfavourable
Variable cost	$75,000.00	$72,000.00	-$3,000.00	Favourable

ekkarill92 answered 1 year ago

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