The master budget at Western Company last period called for sales of 226,900 units at $10.9 each. The costs were estimated to be $3.94 variable per unit and $ $226,900 fixed. During the period , actual production and actual sales were 231,900 units. The selling price was $11.00 per unit. Variable costs were $6.40 per unit. Actual fixed costs were $226,900. Required: Prepare a profit variance anaysis (Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option) that includes: 1. Actual Budget 2. Manufacturing Variances 3. Sales Price Variance 4. Flexible Budget 5. Sales Activity Variance 6. Master Budget
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.
The
Required:
Prepare a profit variance anaysis (Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option) that includes:
1. Actual Budget
2. Manufacturing Variances
3. Sales Price Variance
4. Flexible Budget
5. Sales Activity Variance
6. Master Budget
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