Onyx Company Has Prepared a Static Budget at the Beginning

question 123

Multiple Choice

Onyx Company has prepared a static budget at the beginning of the month. At the end of the month, following information has been retrieved from the records. Static budget:
Sales volume: 2,000 units: Price: $50 per unit
Variable expense: $12 per unit: Fixed expenses: $25,000 per month
Operating income: $51,000
Actual results:
Sales volume: 1,800 units: Price: $58 per unit
Variable expense: $16 per unit: Fixed expenses: $35,000 per month
Operating income: $40,600
Calculate the flexible budget variance for operating income.

• A)$4,500 U
• B)$7,600 U
• C)$2,800 U
• D)$5,490 F

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Definitions:

Employers

Entities or individuals who hire people to perform services or work in exchange for compensation.

Decision

A choice between alternative courses of action.

Action Plan

A detailed proposal for doing or achieving something, outlining tasks, timelines, and resources.

Performance Opportunity

A situation or occurrence that allows an individual or organization to demonstrate their abilities and achieve significant improvements or success.