Exercise 21-5 Preparing a flexible budget performance report LO P1

Bay City Companys fixed budget performance report for July follows. The $440,000 budgeted total expenses include $300,000 variable expenses and $140,000 fixed expenses. Actual expenses include $130,000 fixed expenses.

	Fixed Budget			Actual Results			Variances
Sales (in units)		6,000			4,900
Sales (in dollars)	$	480,000		$	431,200		$	48,800	U
Total expenses		440,000			404,000			36,000	F
Income from operations	$	40,000		$	27,200		$	12,800	U

Prepare a flexible budget performance report that shows any variances between budgeted results and actual results. List fixed and variable expenses separately. (Indicate the effect of each variance by selecting for favorable, unfavorable, and no variance. Do not round your intermediate calculations. Round your final answers to whole dollars.)

BAY CITY COMPANY
Flexible Budget Performance Report
For Month Ended July 31
	Flexible budget	Actual results	Variances	Fav./Unf.
Salesselected answer correct	$392,000selected answer correct	$436,100selected answer incorrect	$44,100selected answer incorrect	Favorableselected answer correct
Variable expensesselected answer correct	245,000selected answer correct	278,000selected answer incorrect	33,000selected answer incorrect	Unfavorableselected answer correct
Contribution marginselected answer correct	147,000selected answer correct	158,100selected answer incorrect	11,100selected answer incorrect	Favorableselected answer correct
Fixed expensesselected answer correct	140,000selected answer correct	130,000selected answer correct	10,000selected answer correct	Favorableselected answer correct
Income from operationsselected answer correct	$7,000selected answer correct	$28,100selected answer incorrect	$21,100selected answer incorrect	Favorable