Odessa, Inc., reports the following information concerning operations for the mo

Question

Odessa, Inc., reports the following information concerning operations for the most recent month Actual (based on actual of 630 units) $118.390 Master Budget (based on budgeted 700 units) $126,000 Sales revenue Less Manufacturing costs Direct labor Materials Variable overhead Marketing Administrative 13,948 14,800 8,750 6.114 6,300 14,700 16,800 10,500 6,790 6.300 Total variable costs Contribution margin $ 68,478 Fixed costs Manufacturing Marketing Administrative 5,450 11.584 11.160 5,600 11,200 11.200 Total fixed costs Operating profits $ 40,284 $ 42,910 There are no inventories

Explanation / Answer

Flexible budget Sales activity variance Planning budget Sales revenue 113400 12600 U 126000 Variable costs: Manufacturing costs: Direct labor 13230 1470 F 14700 Materials 15120 1680 F 16800 Variable overhead 9450 1050 F 10500 Marketing 6111 679 F 6790 Administrative 5670 630 F 6300 Total Variable costs 49581 5509 F 55090 Contribution margin 63819 7091 U 70910 Fixed costs: Manufacturing 5600 0 5600 Marketing 11200 0 11200 Administrative 11200 0 11200 Total Fixed costs 28000 0 28000 Operating profits 35819 7091 U 42910

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