Answer the Following Questions Using the Information Below:
Lander Corporation

question 140

Multiple Choice

Answer the following questions using the information below:
Lander Corporation used the following data to evaluate their current operating system. The company sells items for $18 each and used a budgeted selling price of $18 per unit.
$$\begin{array} { l r r } &\text { Actual } &\text { Budgeted }\\\text { Units sold }& 41,000 \text { units } & 40,000 \text { units } \\\text { Variable costs } & \$ 164,000 & \$ 156,000 \\\text { Fixed costs }&\$ 46,000 & \$ 48,000\end{array}$$
-What is the static-budget variance of variable costs?

• A) $2,000 favorable
• B) $8,000 unfavorable
• C) $4,000 favorable
• D) $6,000 unfavorable

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Definitions:

Consumer Surplus

The difference between the highest price a consumer is willing to pay and the actual price they pay in the market.

Market Demand

The total amount of a product or service that consumers in a market are willing and able to purchase at a given price level in a given time period.

Consumer Surplus

The difference between the maximum price consumers are willing to pay for a good or service and the price they actually pay.

Consumer Surplus

The contrast between the fee consumers are inclined to pay for a good or service and the fee they ultimately pay.