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ch16 Practice Question (Flexible Budget) Ex 3 Ans
ch16 Practice Question (Flexible Budget) Ex 3 Ans
ch16 Practice Question (Flexible Budget) Ex 3 Ans
P Q
PA * QA PB * QA PB * QB
Actual F. Budget Flexible Sales Vol Master
Results Variance Budget Variance Budget
Attendees 90 - 90 15 F 75
PB QA
$ $ $ $ $ $
$ $ $ $ $
price ---- q
for sales
f-f = if selling price is more than the budgeted price, sales rev is higher; more units sold
u-u=variable cost is unfavorable, selling price is less than the budget, units is lower than the budget
f-u=could be favorable price (low price) more demand (more units sold)
u-f=could be unfavorable price (high price), less demand (less units sold) *economic relationship of supply and
demand (demand curve)
for costs
quality of raw material or quality or labor
increase quality = pay more
u for Price, favorable in materials
if cheap materials
F in price = unfavorable in materials