The results for July for Brahms & Sons follow: Actual (based on actual sales of

Question

The results for July for Brahms & Sons follow: Actual (based on actual sales of 67,200 units) $469,500 Master Budget (based on budgeted sales of 56,000 units) $480,000 Sales revenues Less Variable costs Direct material Direct labor Variable overhead Marketing Administration 58,600 47,900 56,100 19,450 17,950 $200,000 $269,500 48,000 57,000 57,000 19,000 19,000 $200,000 $280,000 Total variable costs Contribution margin Less Fixed costs Manufacturing Marketing Administration 102,900 19,700 85,400 $208,000 $61,500 100,800 16,800 $ 84,000 $201,600 $ 78,400 Total fixed costs Operating profits

Explanation / Answer

Flexible Budget Sales revenues 576000 Less Variable costs Direct material 57600 Direct labor 68400 Variable overhead 68400 Marketing 22800 Administration 22800 Total variable costs 240000 Contribution margin 336000 Less Fixed costs Manufacturing 100800 Marketing 16800 Administration 84000 Total fixed costs 201600 Operating profits 134400

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