Question

Static and Flexible Budgets Graham Corporation used the following data to evaluate its current operating system. The company sells items for $10 each and used a budgeted selling price of $10 per unit Actual Budgeted Units sold 400,000 $430,000 Variable costs $1,250,000 $1,500,000 Fixed costs $1.500,000 $1,290,000 a. Prepare the actual income statement, flexible budget, and static budget. Do not use negative signs with any of your answers below. Actual Results Flexible Budget Static Budget Units sold Revenues 05 Variable costs Contribution margin Fixed costs Operating income $ 0 $

Answer 1

Solution Units sold Revenue Variable cost Contribution margin fixed cost Operating income | Actual Rosults flexible Budget 3ta tie Budget 400,000 400,000 430,000 $ 40,00,000 $40,00,000 $ 43,00,000 12,50 000 1,395,349 1500 0 . 2,750.000 2,604,651 | 28,00,000 1,500,000 1,290,000 1,290 000 $1,250,000 1 1,314,654 $1,510,000 (6 Static budget variance of revence = $uo 00,000 - $43,00,000 = $ 300,000 (U) (c) cost flexible = = budget variance for variable $1,395,349-$1,250,000 $145,349 (F) (d) | Flexible cost budget wariance for fixed $1,290 300 – $1,500,000 - $ 210.000 (0) Scared with CSP CamScanner