7.18 Flexible Budget. Virtual Candy Company wholesales sweets on the Internet. The company's budgeted operating profit for the year ended December 31, 2004 was $3,150,000. As a result of the spectacular increase in Internet sales, the actual operating profit was $6,556,000. Request 1. Calculate the total deviations from the provisions of the static budget. 2. Operating profit from the flexible budget was $6,930,000. Calculate total deviations from flexible budget and sales volume. 3.Comment the total deviation from the flexible budget in view of the spectacular increase in sales on the Internet.
7.18 Flexible Budget. Virtual Candy Company wholesales sweets on the Internet. The company's budgeted operating profit for the year ended December 31, 2004 was $3,150,000. As a result of the spectacular increase in Internet sales, the actual operating profit was $6,556,000. Request 1. Calculate the total deviations from the provisions of the static budget. 2. Operating profit from the flexible budget was $6,930,000. Calculate total deviations from flexible budget and sales volume. 3.Comment the total deviation from the flexible budget in view of the spectacular increase in sales on the Internet.
Chapter1: Financial Statements And Business Decisions
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Transcribed Image Text:7.18 Flexible Budget. Virtual Candy Company wholesales sweets on the Internet. The company's budgeted operating profit for the year ended
December 31, 2004 was $3,150,000. As a result of the spectacular increase in Internet sales, the actual operating profit was $6,556,000.
Request
1. Calculate the total deviations from the provisions of the static budget.
2. Operating profit from the flexible budget was $6,930,000. Calculate total deviations from flexible budget and sales volume.
3.Comment the total deviation from the flexible budget in view of the spectacular increase in sales on the Internet.
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