The Static Budget,at the Beginning of the Month,for Beacon Banner

question 68

Multiple Choice

The static budget,at the beginning of the month,for Beacon Banner Company follows: Static budget:
Sales volume: 1100 units; Sales price: $70.00 per unit
Variable costs: $33.00 per unit; Fixed costs: $37,800 per month
Operating income: $2900
Actual results,at the end of the month,follows:
Actual results:
Sales volume: 995 units; Sales price: $75.00 per unit
Variable costs: $35.00 per unit; Fixed costs: $35,000 per month
Operating income: $4800
Calculate the sales volume variance for revenue.

• A) $2800 U
• B) $7350 U
• C) $3885 U
• D) $4975 F

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Definitions:

Individual Job

Definition: A distinct task or project undertaken by a business, where costs and revenues can be directly attributed and tracked.

Time Tickets

The form on which the amount of time spent by each employee and the labor cost incurred for each individual job, or for factory overhead, are recorded.

Product Cost

Product cost is the total expense incurred to produce and deliver a good or service, including direct materials, direct labor, and manufacturing overhead.

Drill Bits

Cutting tools used to remove material to create holes, almost always of circular cross-section.