Answer the Following Questions Using the Information Below:
Barossa Valley

question 118

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 operating profit?

• A)$175 000 favourable
• B)$325 000 unfavourable
• C)$195 000 unfavourable
• D)$225 000 favourable

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Definitions:

Circular-flow Diagram

A visual construct of the financial ecosystem, detailing the exchange of dollars between households and firms via markets.

Legal Services

Professional services provided by lawyers or legal practitioners related to the law, including advice, representation, and the preparation of legal documents.

Revenue Earned

The total income received by a company from its business activities, such as sales of products or services, before any expenses are deducted.

Production Possibilities Frontier

A graph that illustrates the highest potential production levels for two items, considering a specific set of resources.