ACCT 2101 Chapter : ACCT Chapter 10 Notes
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Favorable actual is greater than planned. Unfavorable and actual is less than planned. Favorable - actual is less than planned. Unfavorable - actual is greater than planned. Flexible budgeting a series of static budgets that project data for various levels of activity. The process enhances the relevance of the data: developing a flexible budget , identify the activity index and the relevant range of activity. Remember the cost formula variable costs + fixed. Those differences falling outside particular parameters will be investigated: controllability whether or not the manager can control the occurrence of the variance. Byrd company"s actual results with a sales volume of. The company planned to produce and sell 375,000 units at each. At that volume, variable manufacturing costs were budgeted at . 50 per unit, and variable marketing and administrative costs were budgeted at . 00 per unit. In addition, the company expected an operating profit of ,500. $ 400,000: re-create the static budget, prepare the flexible budget.
