Alaska Company Expressed the Total Expenses (Y) Component of Its

question 38

Multiple Choice

Alaska Company expressed the total expenses (Y) component of its master budget for February with the cost formula Y = $100,000 + $40*X, where X represents the expected number of units of its only product to be manufactured and sold. The budgeted average selling price per unit was $65 for budgeted sales volume 5,000 units. Reported actual results for February were as follows:

-What was the flexible budget variance for February?

• A) $10,000F
• B) $26,000F
• C) $7,400 U.
• D) $2,600F

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Definitions:

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