Given Below Is an Excerpt from a Management Performance Report

question 21

Multiple Choice

Given below is an excerpt from a management performance report: $\begin{array}{llll}&\text { Budget }&\text {Actual }&\text {Difference }\\\text { Contribution margin } & \$ 600,000 & \$ 580,000 & \$ 20,000 \mathrm{U} \\\text { Controllable fixed costs } & \$ 200,000 & \$ 220,000 & \$ 20,000 \mathrm{U}\end{array}$ The manager's overall performance

• A) is 10% above expectations.
• B) is 10% below expectations.
• C) is equal to expectations.
• D) cannot be determined from the information provided.

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Definitions:

Break-even Sales

Break-even sales represent the amount of revenue required to cover all fixed and variable costs, resulting in neither profit nor loss.

Unit Variable Costs

The costs that vary directly with the level of production or sales volume, such as materials and labor, calculated on a per-unit basis.

Break-even Sales

The amount of revenue from sales needed to cover all of a company’s operating expenses, resulting in neither profit nor loss.

Unit Variable Costs

The costs that vary directly with the production volume, including materials and labor, on a per unit basis.