Daniels Corporation used the following data to evaluate their current operating system. The company sells items for $19 each and had used a budgeted selling price of $20 per unit. Actual Budgeted Units sold 280,000 units 270,000 units Variable costs $990,000 $887,000 Fixed costs $60,000 $47,000 Required: (a) Use the information above to prepare the company’s flexible budget.(b) What is the static-budget variance of variable costs? (c) What is the total flexible budget variance?
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Daniels Corporation used the following data to evaluate their current operating system. The company sells items for $19 each and had used a budgeted selling price of $20 per unit.
Actual Budgeted
Units sold 280,000 units 270,000 units
Variable costs $990,000 $887,000
Fixed costs $60,000 $47,000
Required: (a) Use the information above to prepare the company’s flexible budget.(b) What is the static-
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