The Next Year's Budget for Temper,Inc At the End of the Year,the Total Fixed Costs and

question 6

Essay

The next year's budget for Temper,Inc. ,is given below:

$$\begin{array} { | l | r | r | } \hline & \text { Procuct 1 } & \text { Procuct 2 } \\\hline \text { Sales } & \$ 945,000 & \$ 688,500 \\\hline \text { Variable costs } & 459,900 & 297,000 \\\hline \text { Fixed costs } & 300,000 & 300,000 \\\hline \text { Net income } &\underline{ \$ 185,100} &\underline{ \$ 91,500} \\\hline \text { Units } & 126,000 & 54,000 \\\hline\end{array}$$
At the end of the year,the total fixed costs and the variable costs per unit were exactly as budgeted,but the following units per product line were sold:
$$\begin{array} { | c | r | r | } \hline \text { Product Line } & \text { Units } & \text { Sales } \\\hline 1 & 126,200 & \$ 958,579 \\\hline 2 & 56,800 & \$ 721,010 \\\hline\end{array}$$
Required:
(Be sure to indicate whether the variance is favorable or unfavorable. )
a.Compute the sales activity variance for each product.b.Compute the sales mix variance for each product.c.Compute the sales quantity variance for each product.

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Definitions:

Cognitive Schema

A mental framework that organizes and interprets information in the brain, helping individuals understand the world around them.

Developing Concepts

The process of forming ideas or understanding based on the categorization and generalization of objects, events, or situations.

Vehicle

A means of transporting people or goods from one place to another, such as a car, bicycle, or airplane.

Honda

A multinational corporation primarily known for manufacturing automobiles and motorcycles.