The static budget, at the beginning of the month, for Divine Décor Company, follows: Static budget: Sales volume: 1,300 units; Sales price: $70 per unit Variable costs: $32 per unit; Fixed costs: $37,900 per month Operating income: $11,500 Actual results, at the end of the month, follows: Actual results: Sales volume: 990 units; Sales price: $74 per unit Variable costs: $35 per unit; Fixed costs: $34,000 per month Operating income: $4,610 Calculate the flexible budget variance for sales revenue.
The static budget, at the beginning of the month, for Divine Décor Company, follows: Static budget: Sales volume: 1,300 units; Sales price: $70 per unit Variable costs: $32 per unit; Fixed costs: $37,900 per month Operating income: $11,500 Actual results, at the end of the month, follows: Actual results: Sales volume: 990 units; Sales price: $74 per unit Variable costs: $35 per unit; Fixed costs: $34,000 per month Operating income: $4,610 Calculate the flexible budget variance for sales revenue.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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The static budget, at the beginning of the month, for Divine Décor Company, follows:
Static budget:
Sales volume: 1,300 units; Sales price: $70 per unit
Variable costs: $32 per unit; Fixed costs: $37,900 per month
Operating income: $11,500
Actual results, at the end of the month, follows:
Actual results:
Sales volume: 990 units; Sales price: $74 per unit
Variable costs: $35 per unit; Fixed costs: $34,000 per month
Operating income: $4,610
Calculate the flexible budget variance for sales revenue.
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