Question

Success Systems’ second quarter 2014 fixed budget performance report for its computer furniture operations follows. The $159,690 budgeted expenses include $106,400 in variable expenses for desks and $18,290 in variable expenses for chairs, as well as $35,000 fixed expenses. The actual expenses include $36,500 fixed expenses. List fixed and variable expenses separately.

	Fixed Budget		Actual Results		Variances
Desk sales (in units)		140		146
Chair sales (in units)		59		67
Desk sales (in dollars)	$	189,000	$	195,640	$	6,640 F
Chair sales (in dollars)	$	30,090	$	35,175	$	5,085 F
Total expenses	$	159,690	$	168,520	$	8,830 U
Income from operations	$	59,400	$	62,295	$	2,895 F
Perform a flexible budget. and calcuate actual cost $ per unit in respect to desk sales, chair sales,variable expenses.

Answer 1

		Actual	Flexible budget variance		Flexible budget	Sales volume variance		Static budget
	Desk sales	146			146			140
	Chair sales	67			67			59
	Sales revenue Desk	195640	1460	U	197100	8100	F	189000
	Sales revenue chair	35175	1005	F	34170	4080	F	30090
	Total sales revenue	230815	455	U	231270	12180	F	219090
Less	Variable expense Desk				110960	4560	U	106400
	Variable expense chair				20770	2480	U	18290
	Total variable expense	132020	290	U	131730	7040	U	124690
	Contribution margin	98795	745	U	99540	5140	F	94400
Less	Fixed cost	36500	1500	U	35000	0		35000
	Net operating income	62295	2245	U	64540	5140	F	59400