Variance between flexible budget and actual results
Not what you're looking for?
Davis Company provides the following information budgeted for 2007.
Sale price $50 by unit
Cost to manufacture variable $32 by unit
Fixed cost of manufacture $100,000
Fixed cost of sales and administrative $40,000
Davies predicted that the sales will be of 20.000 units, but the current sales were 22,000 units. The current price of sale was of $ 48,50 by unit, and the costs current variables of production were of $33 by unit. Current fixed costs of production and fixed costs of sale and administrative they were of $104.000 and $39.000, respectively.
It required:
A) To utilize the form that appears subsequently, prepare the flexible budget; to present the current results; to determine the varying of the flexible budget; to indicate if the differences are favorable (F) or unfavorable (D).
Flexible Current Variance Favoralbe or
budget results Budget Unfavorable
Flexible
1.Number of
units Sales
2.Variable
costs of
manufacture
3.Contributive
margin
4.Fixed costs
of manufacture
5.Fixed costs of
sales and
administrative
6.Net income
B. to evaluate the performance of the business in comparison with the flexible budget
Purchase this Solution
Solution Summary
The answer contains the evaluation of the performance of the company by computing variance between the flexible budget and actual results.
Purchase this Solution
Free BrainMass Quizzes
Learning Lean
This quiz will help you understand the basic concepts of Lean.
Managing the Older Worker
This quiz will let you know some of the basics of dealing with older workers. This is increasingly important for managers and human resource workers as many countries are facing an increase in older people in the workforce
Academic Reading and Writing: Critical Thinking
Importance of Critical Thinking
Employee Orientation
Test your knowledge of employee orientation with this fun and informative quiz. This quiz is meant for beginner and advanced students as well as professionals already working in the HR field.
Production and cost theory
Understanding production and cost phenomena will permit firms to make wise decisions concerning output volume.