ACCOUNTING
Multiple Choice
Bates Corporation used the following data to evaluate their current operating system. The company sells items for $10 each and used a budgeted selling price of $10 per unit.
Actual Budgeted
Units sold 495,000 units 500,000 units
Variable costs $1,250,000 $1,500,000
Fixed costs $ 925,000 $ 900,000
What is the static-budget variance of variable costs?
a. $200,000 favorable
b. $50,000 unfavorable
c. $250,000 favorable
d. $250,000 unfavorable
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