PROBLEM 10 The controller of Palma Company is examining the following budgeted and actual income statements for its principal product for 2021. All amounts are in thousands of pesos. Sales Variable cost Contribution margin Budget P4,800.0 1,668.0 P3,120.0 Actual P4,967.2 1,780.8 P3,186.4 The budgeted unit selling price is P8.00. Actual unit volume is 6% over budget, but the actual selling price is below budget. Per-unit variable costs are incurred as budgeted. Determine the sales price variance and sales volume 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.
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