Top managers of Root Industges predicted 2025 sales of 14,500 units of its product at a unit price of $9 50. Actual sales for the year were 14,300 units at $11.00 each. Variable costs were budgeted at $3.40 per unit, and actual variable costs were $3.50 per unit. Actual fixed costs of $44,000 exceeded budgeted fixed costs by $5,000 Prepare Root Industries' flexible budget performance report. What variance contributed most to the year's favorable results? What caused this variance? Prepare a flexible budget performance report for the year. First, complete the flexible budget performance report through the contribution margin line, then complete the report through the operating income line. Finally, compute the total variances. (Enter a 0 for any zero balances. Label the variance as favorable (F) or unfavorable (U), in the input field after the amount you enter. For any $0 variances, leave the Favorable (FYUnfavorable (U) input field blank.) Units Sales Revenue Variable Costs Contribution Margin Budget Amounts Per Unit 9.5 3.4 Root Industries Flexible Budget Performance Report For the Year Ended December 31, 2025 1 3 Actual Results 14300 157300 2 (1)-(3) Flexible Budget Variance 21450 F U Flexible Budget 14300 135850 4 (3)-(5) Sales Volume Variance CEEEE U F U 5 Static Budget 14500 140300
Top managers of Root Industges predicted 2025 sales of 14,500 units of its product at a unit price of $9 50. Actual sales for the year were 14,300 units at $11.00 each. Variable costs were budgeted at $3.40 per unit, and actual variable costs were $3.50 per unit. Actual fixed costs of $44,000 exceeded budgeted fixed costs by $5,000 Prepare Root Industries' flexible budget performance report. What variance contributed most to the year's favorable results? What caused this variance? Prepare a flexible budget performance report for the year. First, complete the flexible budget performance report through the contribution margin line, then complete the report through the operating income line. Finally, compute the total variances. (Enter a 0 for any zero balances. Label the variance as favorable (F) or unfavorable (U), in the input field after the amount you enter. For any $0 variances, leave the Favorable (FYUnfavorable (U) input field blank.) Units Sales Revenue Variable Costs Contribution Margin Budget Amounts Per Unit 9.5 3.4 Root Industries Flexible Budget Performance Report For the Year Ended December 31, 2025 1 3 Actual Results 14300 157300 2 (1)-(3) Flexible Budget Variance 21450 F U Flexible Budget 14300 135850 4 (3)-(5) Sales Volume Variance CEEEE U F U 5 Static Budget 14500 140300
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
Related questions
Question
Transcribed Image Text:Top managers of Root Industries predicted 2025 sales of 14,500 units of its product at a unit price of $9.50. Actual sales for the year were 14,300 units at $11.00 each. Variable costs were budgeted at $3.40 per unit, and actual variable
costs were $3.50 per unit. Actual fixed costs of $44,000 exceeded budgeted fixed costs by $5,000
Prepare Root Industries' flexible budget performance report. What variance contributed most to the year's favorable results? What caused this variance?
Prepare a flexible budget performance report for the year. First, complete the flexible budget performance report through the contribution margin line, then complete the report through the operating income line. Finally, compute the total
variances. (Enter a 0 for any zero balances. Label the variance as favorable (F) or unfavorable (U), in the input field after the amount you enter. For any $0 variances, leave the Favorable (F)Unfavorable (U) input field blank.)
Units
Sales Revenue
Variable Costs
Contribution Margin
Budget
Amounts
Per Unit
9.5
3.4
Root Industries
Flexible Budget Performance Report
For the Year Ended December 31, 2025
1
3
Actual
Results
14300
157300
2
(1)-(3)
Flexible
Budget
Variance
21450 F
U
F
Flexible
Budget
14300
135850
(3) - (5)
Sales
Volume
Variance
CAR
DOD
5
Static
Budget
14500
140300
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 3 steps with 2 images
Recommended textbooks for you
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Accounting
Accounting
ISBN:
9781337272094
Author:
WARREN, Carl S., Reeve, James M., Duchac, Jonathan E.
Publisher:
Cengage Learning,
Accounting Information Systems
Accounting
ISBN:
9781337619202
Author:
Hall, James A.
Publisher:
Cengage Learning,
Horngren's Cost Accounting: A Managerial Emphasis…
Accounting
ISBN:
9780134475585
Author:
Srikant M. Datar, Madhav V. Rajan
Publisher:
PEARSON
Intermediate Accounting
Accounting
ISBN:
9781259722660
Author:
J. David Spiceland, Mark W. Nelson, Wayne M Thomas
Publisher:
McGraw-Hill Education
Financial and Managerial Accounting
Accounting
ISBN:
9781259726705
Author:
John J Wild, Ken W. Shaw, Barbara Chiappetta Fundamental Accounting Principles
Publisher:
McGraw-Hill Education