If the sales budget variance for operating income is $58000 and the static budget amount is $15000, then flexible budget amount will be _____________?
Correct answer: B. $73,000
- A. $43,000
- B. $73,000
- C. $63,000
- D. $53,000
Explanation
The sales budget variance equals flexible-budget operating income minus static-budget operating income. Adding the $58,000 variance to the $15,000 static-budget amount gives $73,000, so option b is correct.
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About Cost Accounting
Cost accounting measures and analyses the cost of producing goods or providing services for planning, control and pricing decisions. It covers direct and indirect costs, fixed and variable costs, job and process costing, break-even analysis, marginal costing, overhead allocation, and the difference between product cost and period cost.
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