Question

Beech Company produced and sold 107,000 units of its product in May. For the level of production achieved in May, the budgeted amounts were: sales, $1,270,000; variable costs, $835,000; and fixed costs, $220,000. The following actual financial results are available for May. Actual Sales (107,000 units) $ 1,253,000 Variable costs 803,500 Fixed costs 220,000 Prepare a flexible budget performance report for May.

Answer 1

Answer:

See budget below  

Explanation:

A flexible budget is that  which prepared for the actual activity level achieved using the assumptions of the static budget

Flexible budget

                                         Budget            Actual         variance

Revenue                       1,270,000       1253,000            17000     unfavorable

variable cost                ( 835,000)        (803,500)         31,500    favorable

Contribution                  435000            449500

Fixed cost                      (220,000)     ( 220,000)                 -

 Profit                                 215,000          229,500          14500  Favorable