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aalyn [17]
3 years ago
12

Dynondo Incorporated planned to use materials of $12 per unit but actually used materials of $13 per unit, and planned to make 1

,500 units but actually made 1,800 units. 2. The flexible-budget amount for materials is ________. a) $18,000 b) $19,500 c) $21,600 d) $23,400 3. The flexible-budget variance for materials is ________. a) $1,500 favorable b) $1,800 unfavorable c) $1,500 unfavorable d) $1,800 favorable 4. The sales-volume variance for materials is ________. a) $3,600 favorable b) $3,900 unfavorable c) $3,600 unfavorable d) $3,900 favorable
Business
1 answer:
vaieri [72.5K]3 years ago
8 0

Answer:

A. Flexible Material Budget = $21,600

B. Flexible Material Budget Variance = $1,800 (unfavorable)

C. The sales-volume variance for materials = $3,600 (favorable)

Explanation:

Dynondo Incorporated

A Flexible Budget adjusts the volume of an already approved Master Budget to reflect the Actual Volumes before carrying out a variance Analysis of Actual versus Budget. This is unlike the normal variance process where the volume is for Budget remains fixed and is compared to Actual to reflect a favorable or unfavorable comparison

Budgeted Material Cost = $12 Per Unit.......(a)

Actual Material cost = $13 Per Unit.......(b)

Actual Volume = 1,800......(c)

Budgeted Volume = 1,500......(d)

A. Flexible Material Budget amount = (c) x (a) = 1,800 x $12

= $21,600.........(e)

B. Flexible Material Budget Variance = Actual Material Cost minus (e)

= ($13 x 1,800) minus $21,600

= $23,400 - $21,600

=$1,800 (unfavorable)

C. The sales-volume variance for materials = Budgeted Price per Unit x (Actual Units Sold – Budgeted Units Sold)

= (a) x [(c) - (d)]

= $12 x (1,800 minus 1,500)

= $12 x 300

= $3,600.

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