Question

Luanna Inc. manufactures game consoles. Some of the company's data was misplaced. Use the following information to replace the lost data.

	Actual Results				Flexible Budget Variance				Flexible Budget				Sales Volume Variance				Master Budget
Units		1,960																1,800
Revenues	$	135,240			$	1,960	U			A								B
Variable costs		C															$	68,400
Fixed costs	$	21,700
Operating income	$	46,250								D							$	35,000

The amount D (to the nearest dollar) is:

Multiple Choice

$61,820.

$40,120.

$95,120.

Impossible to determine without further information.

$113,540.

Pleaase show work and how to get others as well if possible. Thank you!

Answer 1

	A)	135,240+1960U
		137200	answer
	B)	137200/1960
		70
		1800*70
		126000	answer
	C)	revenues - fixed cost-operating income
		135240-21700-46250
		67290	answer
	D)	master budget
		fixed expense = revenue - variable cost-operating income
			126000-68400-35000
			22600
		variable cost per unit = 68400/1800
				38
		thus variable cost under flexible budget = 38*1960
						74480
		Operating income= revenue -variable cost-fixed cost
				137,200-74480-22600
				40120	answer