Use the Information Below to Answer the Following Question(s)

question 26

Multiple Choice

Use the information below to answer the following question(s) .
Ames Golf Company used the following data to evaluate their current operating system. The company sells 1 pack of golf balls for $10 per pack. The $10 selling price is also the budgeted selling price.

-A company uses a static budget approach and the previous management accountant calculated the following information: Fixed costs variance $10,000 U; revenues variance $400,000 F; contribution margin variance $60,000 F Required: What is the total static-budget variance?

• A) $50,000 F
• B) $50,000 U
• C) $230,000 F
• D) $230,000 U
• E) $390,000 F

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Definitions:

Restricted Contribution

Funds given to an organization with stipulations on their use, requiring the organization to apply them to a specified project or purpose.

Specific Project

A distinct endeavor with set objectives, timeline, and resources allocated for completion.

Significant Influence

The power to participate in the financial and operating policy decisions of an investee but is not control or joint control over those policies.

Share Ownership

Refers to the possession of shares in a company, representing partial ownership and entitlement to a portion of the company's profits and assets.