Ring Corporation used the following data to evaluate their current operating system.The company sells items for $25 each and used a budgeted selling price of $25 per unit.

Required:
Compute the static-budget variance of revenues,the static-budget variance of variable costs,and the static-budget variance of operating income.

Question

Ring Corporation used the following data to evaluate their current operating system.The company sells items for $25 each and used a budgeted selling price of $25 per unit.

Required:
Compute the static-budget variance of revenues,the static-budget variance of variable costs,and the static-budget variance of operating income.

Quizplus · Accepted Answer

A)Revenues [(195,000 units × $25)- (204,000 units ×$25)] = $225,000 U
Variable costs [($1,500,000 - $2,000,000)= $500,000 F
Operating Income:
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Ring Corporation Used the Following Data to Evaluate Their Current