Onyx Company Prepared a Static Budget at the Beginning of the Month

question 69

Multiple Choice

Onyx Company prepared a static budget at the beginning of the month. At the end of the month, the company is analyzing actual results versus budget using flexible budget methodology. Data are as follows: Based on the above data, how much was the flexible budget variance for operating income?

• A)$4,500 U
• B)$4,500 F
• C)$380 U
• D)$5,490 F

---

Definitions:

Ownership

The state or fact of exclusive rights and control over property, which can be tangible or intangible.

Valuation Allowance

An accounting procedure that an entity might use against its deferred tax assets indicating that it is more likely than not that some portion or all of the asset will not be utilized.

Trading Investments

Assets held by a firm for the purpose of selling them in the short term to generate profit from price fluctuations.

Unrealized Gain

The increase in value of an asset that has not been sold, and thus the profit has not been realized as the asset remains part of the portfolio.