Will Wheaton took over as CEO of ArthurJeffries Inc., after the untimely passing of the companysfounder. The
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Will Wheaton took over as CEO of ArthurJeffries Inc., after the untimely passing of the company’sfounder. The following information is available.
Budget | Actual | ||
Units | 19,500 | 18,000 | |
Salesrevenue | $2,925,000 | $2,880,000 | |
Lessvariable costs: | |||
COGS | $1,170,000 | $1,116,000 | |
Salary & Wages | 321,750 | 288,000 | |
Administrative | 39,000 | 40,500 | |
Total variable costs | $1,530,750 | $1,444,500 | |
Contribution margin | $1,394,250 | $1,435,500 | |
Lessfixed costs: | |||
Salary & Wages | $1,000,000 | $1,000,000 | |
Administrative | 300,000 | $300,000 | |
Insurance | 25,000 | 25,000 | |
Total fixed costs | $1,325,000 | $1,325,000 | |
Operating Income | $69,250 | $110,500 |
Required: Prepare a performance report which provides details on (1) SalesVolume Variance; and, (2) Flexible Budget Variance. Be sureto indicate whether each variance is favorable or unfavorable.
Related Book For
Essentials of strategic management
ISBN: 978-1111525194
3rd Edition
Authors: Charles w. l. hill, Gareth r. Jones
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