AllTalk Technologies manufactures capacitors for cellular base stations and other communications applications. The company's January 2012 flexible budget income statement shows output levels of 6,500, 8,000, and 10,000 units. The static budget was based on expected sales of 8,000 units.
ALLTALK TECHNOLOGIES
Flexible Budget Income Statement
Month Ended January 31, 2012
Per Unit By Units (Capacitors)
6,500 8,000 10,000
Sales revenue $24 $156,000 $192,000 $240,000
Variable expenses $10 65,000 80,000 100,000
Contribution margin $91,000 $112,000 $140,000
Fixed expenses 53,000 53,000 53,000
Operating income $38,000 $59,000 $87,000
The company sold 10,000 units during January, and its actual operating income was as follows:
ALLTALK TECHNOLOGIES
Income Statement
Month Ended January 31, 2012
Sales revenue $246,000
Variable expenses 104,500
Contribution margin $141,500
Fixed expenses 54,000
Operating income $87,500
Requirements:
1. Prepare an income statement performance report for January.
2. What was the effect on AllTalk's operating income of selling 2,000 units more than the static budget level of sales? 3. What is AllTalk's static budget variance? Explain why the income statement performance report provides more useful information to AllTalk's managers than the simple static budget variance. What insights can AllTalk's managers draw from this performance report?
Solved
Show answers
More tips
- C Computers and Internet How to Choose a Monitor?...
- H Horoscopes, Magic, Divination Where Did Tarot Cards Come From?...
- S Style and Beauty How to Make Your Lips Fuller? Ideas and Tips for Beautiful Lips...
- S Style and Beauty How are artificial nails removed?...
- F Family and Home How to Sew Curtain Tapes: Best Tips from Professionals...
- H Horoscopes, Magic, Divination How to Cast a Love Spell on a Guy? Guide for Guys...
- F Family and Home How to Properly Use a Water Level?...
- L Legal consultation What Documents Are Required for a Russian Passport?...
- H Health and Medicine How to Treat Styes: Causes, Symptoms, and Home Remedies...
- F Family and Home Protect Your Home or Apartment from Pesky Ants...
Answers on questions: Business
- C Chemistry Plant roots absorb nitrogen-containing nutrients in the soil through the process of...
- M Mathematics Enter a function in factored and standard form for the given k and set of x-intercepts. x-intercepts: −7 and 9; k = −5...
- M Mathematics Sultan needs enough tents for 28 people to sleep in. Each tent can fit 6 people. How many tents does he need?...
- M Mathematics What are the actual dimensions of a television that has a 15: 9 aspect ratio and a screen that is 42 inches?...
- E English How does the author create an aesthetic impact in the excerpt? read the excerpt from h. g. wells s the war of the worlds. but, looking, i presently saw something stirring...
Ответ:
Being a business owner can be extremely rewarding. Having the ... More importantly, you have the freedom to make the decisions that are crucial to your own business success.
Explanation:
:)