Use the standard price and cost data provided in Exercise 8-1B. Assume the actual sales price was
Question:
In Exercise 8-1B
Imboden Manufacturing Company established the following standard price and cost data:
Sales price ...........................................................................$15 per unit
Variable manufacturing cost....................................................... $ 7 per unit
Fixed manufacturing cost.................................................... $32,500 total
Fixed selling and administrative cost....................................... $24,000 total
Imboden planned to produce and sell 18,000 units. It actually produced and sold 19,000 units.
Required
a. Determine the flexible budget variances.
b. Classify the variances as favorable or unfavorable.
c. Provide another name for the fixed cost flexible budget variances.
d. Comment on the usefulness of the variances with respect to performance evaluation and identify the member(s) of the management team that is (are) most likely to be responsible for these variances.
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Related Book For
Fundamental Managerial Accounting Concepts
ISBN: 978-1259569197
8th edition
Authors: Thomas Edmonds, Christopher Edmonds, Bor Yi Tsay, Philip Olds
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