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Lincoln Corporation used the following data to evaluate their current operating system. The company sells items for $18 each and used a budgeted selling price of $18 per unit.                                                                      Actual             Budgeted         Units sold                             45,000 units         31,000 units         Variable costs                            $161,000               $150,000         Fixed costs                                    $44,000                 $50,000   What is the static-budget variance of variable costs? A) $6,000 favorable B) $11,000 unfavorable C) $14,000 favorable D) $5,000 unfavorable

Lincoln Corporation used the following data to evaluate their current operating system. The company sells items for $18 each and used a budgeted selling price of $18 per unit.                                                                      Actual             Budgeted         Units sold                             45,000 units         31,000 units         Variable costs                            $161,000               $150,000         Fixed costs                                    $44,000                 $50,000   What is the static-budget variance of variable costs? A) $6,000 favorable B) $11,000 unfavorable C) $14,000 favorable D) $5,000 unfavorable

FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
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Lincoln Corporation used the following data to evaluate their current operating system. The company sells items for $18 each and used a budgeted selling price of $18 per unit.

 

                                                                   Actual             Budgeted

        Units sold                             45,000 units         31,000 units

        Variable costs                            $161,000               $150,000

        Fixed costs                                    $44,000                 $50,000

 

What is the static-budget variance of variable costs?

  1. A) $6,000 favorable
  2. B) $11,000 unfavorable
  3. C) $14,000 favorable
  4. D) $5,000 unfavorable
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