Answer the following questions using the information below:
Bland Corporation used the following data to evaluate their current operating system.The company sells items for $10 each and used a budgeted selling price of $10 per unit.
$$\begin{array} { l r r }
& \text { Actual } & \text { Budgeted } \
\text { Units sold } & 184000 \text { units } & 180000 \text { units } \
\text { Variable costs } & \$ 901600 & \$ 864000 \
\text { Fixed costs } & \$ 190000 & \$ 200000
\end{array}$$
-What is the static-budget variance of variable costs?
A)$40 000 favourable
B)$37 600 unfavourable
C)$2400 unfavourable
D)$2400 favourable

Question

Answer the following questions using the information below:
Bland Corporation used the following data to evaluate their current operating system.The company sells items for $10 each and used a budgeted selling price of $10 per unit.
 $$\begin{array} { l r r } 
& \text { Actual } & \text { Budgeted } \
\text { Units sold } & 184000 \text { units } & 180000 \text { units } \
\text { Variable costs } & \$ 901600 & \$ 864000 \
\text { Fixed costs } & \$ 190000 & \$ 200000
\end{array}$$
-What is the static-budget variance of variable costs?
A)$40 000 favourable
B)$37 600 unfavourable
C)$2400 unfavourable
D)$2400 favourable

Quizplus · Accepted Answer

The static-budget variance of variable costs is calculated as the difference between the actual variable costs and the budgeted variable costs. Here, the actual variable costs are $901,600 and the budgeted variable costs are $864,000. The variance is $901,600 - $864,000 = $37,600 unfavourable, because the actual costs exceeded the budgeted costs.

Answer the Following Questions Using the Information Below: Bland Corporation

Answer the Following Questions Using the Information Below:
Bland Corporation