Cottesloe Boogie manufactures boogie boards. The company’s performance report for

Cottesloe Boogie manufactures boogie boards. The company’s performance report for November is as follows:

____________________________ Actual ______________________ Budget

Boogie boards sold ……………… 6 000 ………………………………. 8 000

Variable costs ………………….. 145 000 ……………………………. $300 00

……………. 95 000 …………………………….. 180 000

Fixed costs ……………………… 84 000 ………………………………. 80 000

Operating profit ……………… $ 11 000 ……………………………. $ 40 000

The company uses a flexible budget to analyse its performance and to measure the effect on operating profit of the various factors affecting the difference between budgeted and actual operating profit.

Required:

Calculate the sales price and sales volume variance for November, and indicate whether each is fovourable or unfavourable?

 

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