The actual information pertains to the third quarter. As part of the budgeting process, the controller for Foley Manufacturing had developed the following static budget for the third quarter. The company is in the process of preparing the flexible budget and understanding the results.

The primary reason for high actual operating profits was ________.
A) the variable-cost variance
B) increased fixed costs
C) flexible budget variance for revenues
D) lower sales volume than planned

Question

The actual information pertains to the third quarter. As part of the budgeting process, the controller for Foley Manufacturing had developed the following static budget for the third quarter. The company is in the process of preparing the flexible budget and understanding the results.

The primary reason for high actual operating profits was ________.

The primary reason for high actual operating profits was ________.
A) the variable-cost variance 
B) increased fixed costs 
C) flexible budget variance for revenues 
D) lower sales volume than planned

Quizplus · Accepted Answer

Actual variable costs per unit were significantly less than the static budget. Actual sales revenues were only slightly greater than the static budget, and actual fixed costs were only slightly greater than the static budget.

The Actual Information Pertains to the Third Quarter