Question

Solitaire Company’s fixed budget performance report for June follows. The $337,500 budgeted expenses include $288,000 variable expenses and $49,500 fixed expenses. Actual expenses include $55,900 fixed expenses.

	Fixed Budget			Actual Results			Variances
Sales (in units)		9,000			11,400
Sales (in dollars)	$	450,000		$	570,000		$	120,000	F
Total expenses		337,500			399,000			61,500	U
Income from operations	$	112,500		$	171,000		$	58,500	F

Prepare a flexible budget performance report showing any variances between budgeted and actual results. List fixed and variable expenses separately.

Answer 1

Solitaire Company Flexible Budget Peformance Report For the month ended June 30 Flexible Budget Actual Results Variances Fav./Unfav. Sales 570000 570000 0 No Variance Variable Expenses 364800 343100 21700 E Contribution Margin 205200 226900 21700 E Fixed Expenses Income from Operations 49500 55900 6400 U 171000 155700 15300 F Supporting computations: Total fixed budget sales 450000 Total fixed budget units 9000 Budgeted selling price (per unit) 50 Flexible budget units 11400 Flexible budget sales 570000 Total fixed budget variable expenses 288000 Total units budgeted 9000 Budgeted variable expenses (per unit) 32 Flexible budget units Flexible budget variable expenses 11400 364800 Total actual expenses 399000 Less actual fixed expenses 55900 Total actual variable expenses 343100