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Duo, Incorporated, carries two products and has the following year-end income statement (000s omitted):     Product AR-10 Product ZR-7 Budget Actual Budget Actual Units 2,600 3,600 7,200 6,700 Sales $ $ 13,000 $ 9,720 $ 14,400 $ 14,070 Variable costs 2,860 3,600 7,200 7,040 Fixed Costs 1,800 1,900 2,400 2,400 Total Costs $ 4,660 $ 5,500 $ 9,600 $ 9,440 Operating income $ 8,340 $ 4,220 $ 4,800 $ 4,630   The net effect of AR-10's sales volume variance on profit is:     Multiple Choice   $2,880 favorable.   $1,950 favorable.   $3,900 favorable.   $3,150 favorable.   $2,220 favorable.

Duo, Incorporated, carries two products and has the following year-end income statement (000s omitted):     Product AR-10 Product ZR-7 Budget Actual Budget Actual Units 2,600 3,600 7,200 6,700 Sales $ $ 13,000 $ 9,720 $ 14,400 $ 14,070 Variable costs 2,860 3,600 7,200 7,040 Fixed Costs 1,800 1,900 2,400 2,400 Total Costs $ 4,660 $ 5,500 $ 9,600 $ 9,440 Operating income $ 8,340 $ 4,220 $ 4,800 $ 4,630   The net effect of AR-10's sales volume variance on profit is:     Multiple Choice   $2,880 favorable.   $1,950 favorable.   $3,900 favorable.   $3,150 favorable.   $2,220 favorable.

FINANCIAL ACCOUNTING
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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Q7

 

Duo, Incorporated, carries two products and has the following year-end income statement (000s omitted):

 

  Product AR-10 Product ZR-7
Budget Actual Budget Actual
Units 2,600 3,600 7,200 6,700
Sales $ $ 13,000 $ 9,720 $ 14,400 $ 14,070
Variable costs 2,860 3,600 7,200 7,040
Fixed Costs 1,800 1,900 2,400 2,400
Total Costs $ 4,660 $ 5,500 $ 9,600 $ 9,440
Operating income $ 8,340 $ 4,220 $ 4,800 $ 4,630

 

The net effect of AR-10's sales volume variance on profit is:

 

 

Multiple Choice
  •  

    $2,880 favorable.

  •  

    $1,950 favorable.

  •  

    $3,900 favorable.

  •  

    $3,150 favorable.

  •  

    $2,220 favorable.

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