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The following data are for the month of April for the Reebok Company, a maker of...

The following data are for the month of April for the Reebok Company, a maker of running shoes:

Master budget date: Sales of 9,000 pairs at $30 a pair; variable cost of $23 a pair: total fixed costs of $18,000

Actual results: Sales of 9,600 pairs at $29 a pair; variable cost of $24 a pair; total fixed costs of $18,200

What were the total sales-activity and flexible-budget cariances for the month of April?

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Answer #1

Reebok Company

Flexible - Budget Variances Report Statement

For the month of April

Actual

Budgeted

Variance

9,600 Pairs

9,000 Pairs

Sales Revenue

278,400

270,000

8,400

Favorable

Less : Variable Costs

230,400

207,000

23,400

Unfavorable

Contribution Margin

48,000

63,000

15,000

Unfavorable

Less : Fixed Costs

18,200

18,000

200

Unfavorable

Net Operating Income

29,800

45,000

15,200

Unfavorable

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