$2$

Exercise $14-25($Static$)$ Flexible Budgets and the Breakdown of the Master Budget Variance $[$LO $14-2,143]$

$\frac{2\mathrm{.}75}{5}$

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Assume that in October $2022$ the Schmidt Machinery Company $($Exhibit $14\mathrm{.}1)$ manufactured and sold $950$ units for $$835$ each. During this month, the company incurred $$475,000$ total variable costs and $$180,000$ total fixed costs. The master budget data for the month are as given in Exhibit $14\mathrm{.}1.$

Required:

Prepare a flexible budget for the production and sale of $950$ units.

Compute for October $2022$:

a$.$ The sales volume variance, in terms of operating income. Indicate whether this variance was favorable or unfavorable.

b$.$ The sales volume variance, in terms of contribution margin. Indicate whether this variance was favorable or unfavorable.

Compute for October $2022$:

a$.$ The total flexible budget variance. Indicate whether this variance was favorable or unfavorable.

b$.$ The total variable cost flexible budget variance. Indicate whether this variance was favorable or unfavorable.

c$.$ The total fixed cost flexible budget variance. Indicate whether this variance was favorable or unfavorable.

d$.$ The selling price variance. Indicate whether this variance was favorable or unfavorable.

Complete this question by entering your answers in the tabs below.

Ref$$zuired $1$

Required $2$

Required $3$

Prepare a flexible budget for the production and sale of $950$ units.

$\backslash$table$[[$Units sold,,$950],[$Sales$,$$$,760,000],[$Variable costs,$0,475,000$