Whistler Table Company Manufactures Tables for Schools

question 60

Essay

Whistler Table Company manufactures tables for schools.The current year operating budget is based on sales of 20,000 units at $100 per table.Operating income is anticipated to be $120,000.Budgeted variable costs are $64 per unit while fixed costs total $600,000.Actual income for the year was $2,184,000 on actual sales of 21,000 units.Actual variable costs were $60 per unit and fixed costs totaled $570,000.Required:
Prepare a Level 2 variance analysis report with both flexible-budget and sales-volume variances.

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Definitions:

Multiple-Step Income Statement

A form of income statement that contains several sections, subsections, and subtotals.

Income from Operations

The earnings generated from the day-to-day activities of a business, excluding income and expenses from non-operational sources.

Net Income

The net income of a company, which is calculated by deducting all expenses and taxes from the total revenue.

FOB Shipping Point

A shipping term indicating that the buyer assumes all costs and risks of loss or damage to the goods once they are shipped by the seller.