The Static Budget,at the Beginning of the Month,for Onyx Décor

question 142

Multiple Choice

The static budget,at the beginning of the month,for Onyx Décor Company,follows: Static budget:
Sales volume: 1,100 units; Sales price: $70.00 per unit
Variable costs: $32.00 per unit; Fixed costs: $38,000 per month
Operating income: $3,800
Actual results,at the end of the month,follows:
Actual results:
Sales volume: 980 units; Sales price: $75.00 per unit
Variable costs: $35.00 per unit; Fixed costs: $34,200 per month
Operating income: $5,000
Calculate the flexible budget variance for sales revenue.

• A) $5,760 U
• B) $5,760 F
• C) $4,900 U
• D) $4,900 F

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Definitions:

Beginning Capital

The amount of capital or equity held by a business or individual at the start of an accounting period.

Capital Balances

Capital balances reflect the amount of money that owners have invested in a company, including retained earnings and additional contributions.

Net Income

The net income of a business once all costs, such as operating expenses and taxes, are subtracted from its total earnings.

Income Sharing

An arrangement where generated income is distributed among participants or partners, often in proportion to their investment or contribution.