If it had - Interest Expense Income before Income Taxes...

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If it had, the budget report would be as follows:  Pick Up Trucks Company Flexible Budget Report For the Second Quarter 20X1 Actual Budget Variance—Favorable/(Unfavorable) Sales: Expected 17,000 Actual 17,500 Sales Units 17,500 17,500 0 Sales $259,000 $262,500 $(3,500) Cost of Goods Sold 196,875 196,875 0 Gross Profit 62,125 65,625 (3,500) Selling Expenses 24,610 24,750 140 General and Administrative Expenses 20,250 20,250 0 Operating Income 17,265 20,625 (3,360)
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Unformatted text preview: Interest Expense Income before Income Taxes 17,265 20,625 (3,360) Income Taxes 6,906 8,250 1,344 Net Income $ 10,359 $ 12,375 $(2,016) The flexible budget shows an even higher unfavorable variance than the static budget. This does not always happen but is why flexible budgets are important for giving management an indication of what questions need to be asked....
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This note was uploaded on 11/16/2011 for the course ACCT 2310 taught by Professor Staff during the Spring '09 term at Texas State.

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If it had - Interest Expense Income before Income Taxes...

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