Business Solutions's second-quarter 2020 fixed budget performance report for its computer furniture operations follows. The $162,290 budgeted expenses include $113,710 in variable expenses for desks and $14,580 in variable expenses for chairs, as well as $34,000 fixed expenses. The actual expenses include $35,500 fixed expenses. List fixed and variable expenses separately. Fixed Budget Actual Results Variances Desk sales (in units) 137 143 Chair sales (in units) 54 62 Desk sales $ 178,100 $ 184,470 $ 6,370 F Chair sales 27,000 31,930 4,930 F Total expenses 162,290 171,220 8,930 U Income from operations $ 42,810 $ 45,180 $ 2,370 Prepare a flexible budget performance report that shows any variances between budgeted results and actual results.

First we find thebudgeted unit sales values and then multiply with the actual units to get the flexible sales value. We do the similar operations for the expenses and then do the calculations. If the actual revenue is greater than flexible budget revenue then it is favorable  but if actual expenses are more then they are unfavorable.

Explanation:

Business Solutions

                               Fixed Budget        Actual Result      Variance

Desks Units              137                               143

Chair sales (in units) 54                                 62

Desk sales               $ 178,100                 $ 184,470            $ 6,370 F

Chair sales                27,000                      31,930                 4,930 F

Total expenses        162,290                     171,220                8,930 U

Income from operations $ 42,810             $ 45,180              $ 2,370

Business Solutions

Flexible Budget Performance Report

Second-Quarter 2020

                              Flexible Budget     Actual Results   Variance (F/ UNfav)

Desks                       ( $ 178,100 /137)143

                                        185900                  $ 184,470           1430 Unfav

Chairs                    (27,000/54) 62

                                     31000                         31930                930 Fav

Variable Expenses       135430                      135720             290 unfav

Desk Sales              (113710/137)  * 143                  

                                         118690                  

Chair sales             ($14,580/ 54)(62)

                                        16740                    

Add Fixed                      $34,000                 $35,500         1,500 ( unfav)

Income from Operation  47470                   45180              2290 unfav

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