I. The actual information pertains to the month of August. As part of the budgeting pro Alloway's Fencing Company developed the following static budget for August. Allow: in the process of preparing the flexible budget and understanding the results. Actual Flexible Static Results Budget Budget 25,000 Sales volume (in units) 20,000 Sales revenues $1,000,000 $ $1,250,000 Variable costs 512,000 $ 600,000 Contribution margin 488,000 $ 650,000 Fixed costs 2$ 450,000 $ 200,000 458,000 Operating profit $ 30,000 2$ Required: Prepare the flexible budget and state the flexible budget variances for variable cost and fixed cost.
I. The actual information pertains to the month of August. As part of the budgeting pro Alloway's Fencing Company developed the following static budget for August. Allow: in the process of preparing the flexible budget and understanding the results. Actual Flexible Static Results Budget Budget 25,000 Sales volume (in units) 20,000 Sales revenues $1,000,000 $ $1,250,000 Variable costs 512,000 $ 600,000 Contribution margin 488,000 $ 650,000 Fixed costs 2$ 450,000 $ 200,000 458,000 Operating profit $ 30,000 2$ Required: Prepare the flexible budget and state the flexible budget variances for variable cost and fixed cost.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:I. The actual information pertains to the month of August. As part of the budgeting pro
Alloway's Fencing Company developed the following static budget for August. Allow:
in the process of preparing the flexible budget and understanding the results.
Actual
Flexible
Static
Results
Budget
Budget
25,000
Sales volume (in units)
20,000
Sales revenues
$1,000,000
512,000
$
$
$1,250,000
Variable costs
600,000
Contribution margin
488,000
$
650,000
Fixed costs
458,000
$
450,000
Operating profit
$30,000
$
$ 200,000
Required:
Prepare the flexible budget and state the flexible budget variances for variable cost
and fixed cost.
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