The Accountant for Dalton Company Prepared the Following Performance Report

question 130

Essay

The accountant for Dalton Company prepared the following performance report:
$\begin{array}{|l|c|c|c|}\hline &\text { Static Budget } & \text { Flexible Budget } & \text { Actual Results } \\\hline \text { Number of units } & 4,000 & 4,500 & 4,500 \\\hline\\\hline \text { Sales } & \$ 200,000 & \$225,000 &\$ 223,000 \\\hline \text { Less variable costs: } & & & \\\hline \text { Materials } & 72,000 & 81,000 & 81,600 \\\hline \text { Labor } & 50,000 & 56,250 & 54,000 \\\hline \text { Overhead } & 16,000 & 18,000 & 17,800 \\\hline \text { Contribution margin } & \$ 23,000 & \$ 25,875 & \$ 21,900 \\\hline \text { Less fixed costs: } & & & \\\hline \text { Manufactuing } & 15,000 & 15,000 & 13,350 \\\hline \text { Selling and admin. } & 6,500 & 6,500 & 6,600 \\\hline \text { Net income } &\$ 1,500 &\$ 4,375 &\$ 1,950 \\\hline \end{array}$
Required:
1)Compute the sales volume variance in units.
2)Compute the percentage increase in revenue generated by the increase in activity.
3)Compute the percentage increase in budgeted profitability that resulted from the increase in revenue.Explain this result.
4)How would differences between planned and actual volume impact companies that use a cost-plus pricing strategy?

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Definitions:

Employment Center

A facility or service that provides resources, tools, and support for job seekers and employers.

Homeless People

Individuals who lack stable, safe, and adequate housing, which includes those who sleep on the streets, in shelters, or in temporary accommodations.

Psychotic Disorder

A mental health condition characterized by an impaired relationship with reality, often including delusions, hallucinations, and disordered thinking.

Schizophrenia

A complex psychiatric disorder that affects a person's ability to think, feel, and behave clearly, often characterized by delusions, hallucinations, and disordered thinking.