Timberlake Company Planned for a Production and Sales Volume of 12,000

question 138

Multiple Choice

Timberlake Company planned for a production and sales volume of 12,000 units. However, the company actually makes and sells 13,000 units.What was the total variable cost volume variance? $\begin{array}{|l|r|r|r|}\hline && \text { Static Budget } & \text { Flexible Budget } \\\hline \text { Number of units } && 12,000 & 13,000 \\\hline & \begin{array}{l}\text { Per unit } \\\text { standards }\end{array} \\\hline \text { Sales revemue } & \$ 65.00&\$780,000&\$845,000 \\\hline \text { Variable manufacturing costs } & & & \\\hline \text { Materials } & \$ 11.00 & 132,000 & 143,000 \\\hline \text { Labor } & \$ 9.00 & 108,000 & 117,000 \\\hline \text { Overhead } & \$ 4.20 & 50,400 & 54,600 \\\hline \text { Variable G,S\&A } & \$ 11.00 & 132,000 & 143,000 \\\hline \text { Contribution margin } && \$ 357,600 & \$ 387,400 \\\hline {\text { costs }} \\\hline \text { Manufacturing overhead } && 100,800 & 100,800 \\\hline \mathrm{G}, \mathrm{S} \& \mathrm{~A} & & 45,000 & 45,000 \\\hline \text { Net income } && \$ 211,800 &\$ 241,600 \\\hline\end{array}$

• A)$29,800 unfavorable
• B)$29,800 favorable
• C)$35,200 unfavorable
• D)$35,200 favorable

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