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I want to ask you about question from pilot paper 2011 ‘Coolfreeze’
Budget Actual
Unit 83 50Revenue 83,000 45,000
Raw Material (29,050) (15,000)
Labour (26,975) (15,750)
Fixed Oh (18,000) (18,000)How did they workout flexed budget in the answer?
Ive had a quick look and I can’t get it either. Seems to me that the flexed revenue should be 50,000. Variable costs seem to be flexed as you would expect.
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Steve Skidmore shouldn’t be flexing the sales price, as every component should be flexed at the standard price based on the revised volume. So sales should be 1000 x 50 = 50000.
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