The financial results for one of the subunits of Factory Six Racing is presented in the partially completed performance evaluation report below.
* Flexible budget variance/Flexible budget
Required:
1. Complete the performance report rounding to three decimal places.
2. Based on the data presented, what type of responsibility centre is this subunit?
3. Which items should be investigated if part of management's decision criteria is to investigate all variances equal to or exceeding $5,000 and exceeding 10% ( both criteria must be met)?
Definitions:
Lemonade
A sweetened beverage made from lemon juice, water, and sugar, often sold as a refreshment during warm weather.
Opportunity Cost
Opportunity cost is the loss of potential gain from other alternatives when one alternative is chosen.
Cancún
A Mexican city on the Yucatán Peninsula bordering the Caribbean Sea, known for its beaches, resorts, and nightlife.
Paris
The capital city of France, known for its significant cultural, historical, and economic contributions to the world.
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