Chapter 7, Problem 7.22E

Flexible budget. Bryant Company’s budgeted prices for direct materials, direct manufacturing labor and direct marketing (distribution) labor per attaché case are $43, $6, and $13, respectively. The president is pleased with the following performance report:

Actual output was 10,000 attaché cases. Assume all three direct-cost items shown are variable costs.

Required

Is the president’s pleasure justified? Prepare a revised performance report that uses a flexible budget and a static budget.