The static budget, at the beginning of the month, for Singleton Company follows
Static budget:
Sales volume: 1,000 units; Sales price: $70.00 per unit
Variable costs: $32.00 per unit; Fixed costs: $35,500 per month
Operating income: $2,500
Actual results, at the end of the month, follows:
Actual results:
Sales volume: 980 units; Sales price: $74.00 per unit
Variable costs: $35.00 per unit; Fixed costs: $33,300 per month
Operating income: $4,920
Calculate the flexible budget variance for fixed costs.
A) $2,200 U
B) $2,200 F
C) $0
D) $3,180 F
B .B)
Actual Results Flexible Budget Variance Flexible Budget Sales Volume Variance Static Budget
Units 980 0 980 20 U $1,000
Sales Revenue* $72,520 3,920 F $68,600 $1,400 U $70,000
Variable Costs** 34,300 2,940 U 31,360 $640 F 32,000
Contribution Margin $38,220 $980 F $37,240 $760 U $38,000
Fixed Costs 33,300 2,200 F 35,500 $0 35,500
Operating Income/(Loss) $4,920 $3,180 F $1,740 $760 U $2,500
* Sales price per unit x Units
** Variable cost per unit x Units
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Use the information in Table 10.1. Which one of these trade-offs works to your greatest advantage in terms of reducing costs over the entire planning period?
A) Produce units using part-time workers instead of regular-time workers. B) Begin with a larger anticipation inventory to avoid backorders completely. C) Use no overtime, subcontracting, or part time in favor of a level regular-capacity plan. D) Begin the planning period with 570 units of anticipation inventory and produce nothing in the planning period.
Actions that benefit shareholders but harm the other stakeholders would be viewed as ________ from the efficiency perspective but ________ from the social responsibility perspective
A) managerially responsible; socially irresponsible B) socially responsible; managerially irresponsible C) socially irresponsible; managerially responsible D) managerially irresponsible; socially responsible