FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Folsom Fashions sells a line of women's dresses. Folsom's
performance report for November is shown below. (CMA
adapted)
The company uses a flexible budget to analyze its performance
and to measure the effect on operating income of the various
factors affecting the difference between budgeted and actual
operating income.
Dresses sold
Sales
Variable costs
Contribution margin
Fixed costs
Operating income
5,000
Actual
$235,000
($145,000)
$90,000
($84,000)
$6,000
Budget
6,000
$300,000
($180,000)
$120,000
($80,000)
$40,000
1. The effect of the sales quantity variance on the contribution
margin for November is:
$30000 U, $18000 U, $20000 U, $15000 U
2. The sales price variance for November is:
$30000 U, $18000 U, $20000 U, $15000 U
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Transcribed Image Text:Folsom Fashions sells a line of women's dresses. Folsom's performance report for November is shown below. (CMA adapted) The company uses a flexible budget to analyze its performance and to measure the effect on operating income of the various factors affecting the difference between budgeted and actual operating income. Dresses sold Sales Variable costs Contribution margin Fixed costs Operating income 5,000 Actual $235,000 ($145,000) $90,000 ($84,000) $6,000 Budget 6,000 $300,000 ($180,000) $120,000 ($80,000) $40,000 1. The effect of the sales quantity variance on the contribution margin for November is: $30000 U, $18000 U, $20000 U, $15000 U 2. The sales price variance for November is: $30000 U, $18000 U, $20000 U, $15000 U
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