Managerial Accounting
Answers
Answer: a. Flexible budgeted sales variance: ($36.00 - $35.00) × 31,000 = $31,000 U Flexible budgeted variable cost variance: (($9.10+ $4.10 + $6.20 + $6.10) - ($8.50 + 3.70 + $5.60 + $5.50)) × 31,000 = $9,300 F Flexible budgeted fixed cost variance: ($185,000 - $175,000) = $10,000 U Another name for the fixed cost flexible budget variance is the static budget variance. b. Flexible budgeted sales variance: U Flexible budgeted variable cost variance: F Flexible budgeted fixed cost variance: U c. The position responsible for the flexible budgeted sales variance is the sales manager. The higher than expected sales price could be caused by increased demand or competitive pricing. The position responsible for the flexible budgeted variable cost variance is the production manager. This variance could be caused by more efficient operations, reduced material costs, or a change in the proportion of materials used. The position responsible for the flexible budgeted fixed cost variance is the financial manager. This variance could be caused by a decrease in fixed costs due to cost-cutting measures
