Question list

Network Technologies manufactures capacitors for cellular base stations and other communications applications. The company's July $2024$ flexible budget shows output levels of $7,000,8,500,$ and $10,500$ units. The static budget was based on expected sales of $8,500$ units. The company sold $10,500$ units during July. Its flexible budget and actual operating income was as follows:

$($Click the icon to view the flexible budget.$)$

$($Click the icon to view the income statement.$)$

Read the requirements.

Requirements

Prepare a flexible budget performance report for July.

What was the effect on Network's operating income of selling $2,000$ units more than the static budget level of sales?

What is Network's static budget variance for operating income?

Explain why the flexible budget performance report provides more useful information to Network's managers than the simple static budget variance. What insights can Network's managers draw from this performance report?

u $$

Sales Revenue

Variable Expenses Contribution Margin

Fixed Expenses

Operating Income

Data table

$\backslash$table$[[\backslash$table$[[$Network Technologies$],[$Income Statement$],[$For the Month Ended July $31,2024]]],[$Sales Revenue,$$,248,500],[$Variable Expen$$es$,,162,600],[$Contribution Margin,,$85,900],[$Fixed Expenses,,$51,500],[$Operating Income,,$]]$

Print

Done

Done

Datix table