For the coming period Candy has budgeted to purchase and use 41,650 ounces of icing at $0.21 an ounce. She budgeted for 19,800 full dozen doughnuts to be iced. If actual purchases and usage were 43,000 ounces at $0.19 an ounce and output was 20,000 full dozen iced doughnuts, what would the variances be? 1. Compute the flexible-budget variance 2. Compute the price and efficiency variances.
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
For the coming period Candy has budgeted to purchase and use 41,650 ounces of icing at $0.21 an ounce. She budgeted for 19,800 full dozen doughnuts to be iced. If actual purchases and usage were 43,000 ounces at $0.19 an ounce and output was 20,000 full dozen iced doughnuts, what would the variances be?
1. Compute the flexible-
2. Compute the price and efficiency variances.
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