ACCOUNTING-A. Set-up of the problem Fixed Budget
QUESTION
A. Set-up of the problem
Fixed
Budgeted $
Actual
Actual $
Variance
Budget
Per Unit
Results
Per Unit
In $ Total
Desk sales (units)
(AKA
Chairs sales (units)
Standard
Total sales
($)
Costs)
Desk
sales ($)
Chair
Sales ($)
Budgeted Expenses
V-desks
V-chairs
Fixed exp.
Total Exp.
Gross profit per
desks
Gross profit per
chair
Total gross profit
Fixed Expenses
Profit
B. Analysis of
Variance
TOTAL
UNITS
0
0
VARIABLE
COSTS
Analysis
Budgeted
of variance
Actual
Variable
costs
0
Per
unit VC
Variable variance
Due to Cost
*
Due to Efficiency
**
Total variance of
VC:
FIXED
COSTS
Analysis
Budgeted
of variance
Actual
Fixed
costs
0
Per unit FC
FC variance
Due to Cost
*
Due to Efficiency
**
Total variance of
FC:
*Cost
variance= (actual quantity * actual rate) – (actual quantity *standard rate)
**Efficiency
variance= (actual quantity* standard rate) – (standard quantity *standard
rate)
C. Possible
Flexible Budget
Flexible
$ Per
Actual
Budget 1
Unit
Results
Desk sales (units)
Chairs sales (units)
Desk
sales ($)
Chair
Sales ($)
Budgeted Expenses
V-desks
V-chairs
Fixed expenses
Total Budget Exp.
Gross profit per
desks
Gross profit per
chair
Total gross profit
Fixed Expenses
Profit
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