Use the information below to answer the following question(s).Bates 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.
-What is the static-budget variance of revenues?
A)$50,000 favourable
B)$50,000 unfavourable
C)$5,000 favourable
D)$5,000 unfavourable
E)$25,000 unfavourable

Question

Use the information below to answer the following question(s).Bates 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. 
-What is the static-budget variance of revenues?
A)$50,000 favourable 
B)$50,000 unfavourable 
C)$5,000 favourable 
D)$5,000 unfavourable 
E)$25,000 unfavourable

Quizplus · Accepted Answer

The static-budget variance of revenues is calculated by subtracting the budgeted revenue from the actual revenue. Since the budgeted selling price and actual selling price are the same ($10), the actual revenue should match the budgeted revenue. Therefore, any difference between the two would be an unfavorable static-budget variance. Thus, the answer is (B) $50,000 unfavorable.

Use the Information Below to Answer the Following Question(s)