The managerial accountant prepared the following Level-1 analysis for The Halcyon Carpet renewal system company:
The Halcyon Carpet Renewal System Company
Level-1 Analysis
Actual results Static Budget Static Budget
Variances
Units Sold 85,000 ________ 100,000
Revenues $425,000 ________ $500,000
Variable Costs
Direct Materials $530,300 ________ $615,900
Direct Manufacturing
Labor $210,000 ________ $202,000
Variable Manufacturing
Overhead $165,000 ________ $182,500
Total Variable Costs $905,300 ________ $1,000,400
Contribution Margin $475,000 ________ $564,000
Fixed Costs $450,000 ________ $437,000
Operating Income $25,000 ________ $127,000
Required
Compute the static-budget variances of (a) units sold; (b) revenues; (c) direct materials; (d) direct manufacturing labor; (e) variable manufacturing overhead; (f) total variable costs; (g) contribution margin; (h) fixed costs; (i) operating income.
A) (a) 15,000, (b) $75,000, U, (c) $85,600, (d) $8,000, U, (e) $17,500, (f) $95,100, F, (g) $89,000, (h) $13,000, U, (i) $102,000, U.
B) (a) 17,000, (b) $80,000, F, (c) $92,300, (d) $6,000, U, (e) $12,600, (f) $98,100, U, (g) $93,000, (h) $15,000, F, (i) $112,000, F.
C) (a) 13,000, (b) $85,000, F, (c) $95,000, (d) $4,000, F, (e) $14,300, (f) $103,000, F, (g) $95,000, (h) $108,000, U, (i) $135,000, U
D) (a) 16,000 (b) $85,000, F, (c) $64,200, (d) $18,000, U, (e) $7,000, (f) $113,000, F, (g) $75,000, (h) $78,000, U, (i) $103,000, F.
E) (a) 9,000, (b) $54,000, F, (c) $68,000, (d) $12,000, U, (e) $23,000, (f) $110,500, U, (g) $63,000, (h) $92,000, F, (i) $100,000, U.
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