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.

Answer rating: 100% (QA)

To prepare the performance report we need to calculate the sales volume variance and flexible budget ... View the full answer