McGrath's Produces and Sells Two Types of T-Shirts-Fancy and Plain

question 173

Essay

McGrath's produces and sells two types of t-shirts-Fancy and Plain.The company provides the following data:
$$\begin{array} { l l l } & \text { Budget } & \text { Actual } \\\text { Unit sales price - Fancy } & \$ 24 & \$ 25 \\\text { Unit sales price - Plain } & \$ 18 & \$ 17 \\\text { Unit sales - Fancy } & 1,300 & 1,250 \\\text { Unit sales - Plain } & 9 0 0&8 7 5\end{array}$$ Compute the flexible budget variance for Fancy t-shirts for sales revenue.

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Definitions:

Gross Profit

The financial metric that represents the difference between sales revenue and the cost of goods sold, before deducting overheads, payroll, taxation, and interest payments.

Profit Center

A branch or division of a company that is treated as a separate entity for the purpose of calculating its profitability.

Profit Center

A division or segment of a company that is directly responsible for generating its own revenue and profit through its activities.

Cost Center

A department or segment of a business that does not directly generate revenue but incurs costs, focusing instead on controlling expenses.