Greenhouse Corporation Used the Following Data to Evaluate Their Current

question 70

Multiple Choice

Greenhouse Corporation used the following data to evaluate their current operating system.The company sells items for $12 each and had used a budgeted selling price of $13 per unit.

Required
Compute the static-budget variance of revenues,the static-budget variance of variable costs,and the static-budget variance of operating income.

• A)$200,000 F;$8,000 F;$258,000 F
• B)$210,000 U;$8,100 U;$259,000 U
• C)$205,000 F;$8,500 F;$260,000 F
• D)$210,000 U;$9,250 U;$261,000 F
• E)$249,000 U;$9,750 U;$262,000 U

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Definitions:

Sensitivity Analysis

An analysis method to evaluate how changes in the values of an independent variable influence a dependent variable, based on a set of given assumptions.

NPV

Stands for Net Present Value, a method used in capital budgeting to evaluate the profitability of an investment or project.

Scenario Analysis

The process of analyzing and evaluating possible future events by considering various feasible outcomes or scenarios, typically to assess potential risks and impacts.

Best Case Scenario

The most favorable or desirable outcome possible in a given situation.