Question

The manager at Jerome Mobility, Inc. reported the following information for 2019: Actual Results Static Budget Units sold 1,700 units 1,500 units Revenues $221,000 $195,000 Variable costs Direct materials 70,000 60,000 Direct manufacturing labor 36,500 31,500 Variable manufacturing overhead 16,000 13,500 Total variable costs 122,500 105,000 Contribution margin 98,500 90,000 Fixed costs 51,000 50,000 Operating income $47,500 $40,000 What is the static-budget variance for operating income for Jerome Mobility Inc. for 2019

Answer 1

$7,500 F

Step-by-step explanation:

Calculation to determine the static-budget variance for operating income for Jerome Mobility Inc. for 2019

Using this formula

2019 Static budgeted variance for operating income = Actual result - Static budget amount

Let plug in the formula

2019 Static budgeted variance for operating income= $47,500 - $40,000

2019 Static budgeted variance for operating income= $7,500 F

Therefore the static-budget variance for operating income for Jerome Mobility Inc. for 2019 will be $7,500 F