Magnet TechnologiesFlexible Budget Performance ReportMonth Ended July 31, 2019Flexible BudgetSales VolumeStatic (Master)Budget FormulaFav/UnfavFlexible BudgetVarianceFav/UnfavBudgetActual ResultsVarianceUnitsSales RevenueVariable ExpensesContribution Marginp Fixed Expenses1 Operating Income42536format style789 # 4. Magnet Technologies manufactures refrigerator magnets for companies as promotional items. The company's July 2019 Flexible Budget shows output levels of 3,000, 5,000 and 7,000 units.The static budget was based on 5,000 unitsBudget Formula5 Unitss Sales- Variable Expenses3 Contribution Margine Fixed ExpensesO Net Income3,000$120,000$57,0005,000$200,000$95,0007,000$40$19$280,000$133.000$147,000$32,000$115,000$63.000$105,000$32,000$32,000$31,000$73,00012 The company sold 7,000 units and it's actual results are as follows:1 Sales5 Variable ExpensesContribution Margin7 Fixed Expenses8 Net Income$297,000$151,000$146,000$34,000$112,000O Required:1 1. Prepare the Flexible Budget Performance Report2 2. What is the effect on net income on Magnet Technologies from selling more units that the Master Budget anticipated?3 3. Why are flexible budget reports useful to managers?

A report that is prepared to determine the actual revenues and costs for actual sales during the…

4. Magnet Technologies manufactures refrigerator magnets for companies as promotional items. The company's July 2019 Flexible Budget shows output levels of 3,000, 5,000 and 7,000 units The static budget was based on 5,000 units Budget Formula nits ales ariable Expenses contribution Margin ixed Expenses let Income 3,000 $120,000 5,000 $200,000 7,000 $280,000 $40 $19 $57.000 $95.000 $133,000 $63,000 $32,000 $31,000 $105.000 $147,000 $32,000 $115,000 $32,000 $73,000 The company sold 7,000 units and it's actual results are as follows: Sales ariable Expenses Contribution Margin Fixed Expenses $297,000 $151,000 $146,000 $34,000 let Income $112,000

4. Magnet Technologies manufactures refrigerator magnets for companies as promotional items. The company's July 2019 Flexible Budget shows output levels of 3,000, 5,000 and 7,000 units The static budget was based on 5,000 units Budget Formula nits ales ariable Expenses contribution Margin ixed Expenses let Income 3,000 $120,000 5,000 $200,000 7,000 $280,000 $40 $19 $57.000 $95.000 $133,000 $63,000 $32,000 $31,000 $105.000 $147,000 $32,000 $115,000 $32,000 $73,000 The company sold 7,000 units and it's actual results are as follows: Sales ariable Expenses Contribution Margin Fixed Expenses $297,000 $151,000 $146,000 $34,000 let Income $112,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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