Answer the Following Questions Using the Information Below:
Barossa Valley

question 145

Multiple Choice

Answer the following questions using the information below:
Barossa Valley Wines used the following data to evaluate their current operating system.The company sells items for $10 each and used a budgeted selling price of $10 per unit.
$$\begin{array} { l r r } & \text { Actual } & \text { Budgeted } \\\text { Units sold } & 495000 \text { units } & 500000 \text { units } \\\text { Variable costs } & \$ 1250000 & \$ 1500000 \\\text { Fixed costs } & \$ 925000 & \$ 900000\end{array}$$
-What is the static-budget variance of revenues?

• A)$50 000 favourable
• B)$50 000 unfavourable
• C)$5000 unfavourable
• D)$5000 favourable

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Definitions:

Liabilities

Financial obligations or debts a company owes to others, which must be paid back in the future.

Adjust Prepaid Insurance Expense

The process of allocating prepaid insurance cost over the period to which it applies, reflecting its usage over time.

Financial Statements

Documents that provide an overview of a company's financial condition, including balance sheet, income statement, and cash flow statement.

Net Income

The total earnings of a company after all expenses and taxes have been deducted from total revenue, representing profitability.