Pick Up Trucks Company Budget Report For the Second Quarter 20X1

Pick Up Trucks Company Budget Report For the Second Quarter 20X1

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Pick Up Trucks Company Budget Report For the Second Quarter 20X1 Actual Budget Variance—Favorable/(Unfavorable) Sales Units 17,500 17,000 Sales $259,000 $255,000 $ 4,000 Cost of Goods Sold 196,875 191,250 (5,625) Gross Profit 62,125 63,750 (1,625) Selling Expenses 24,610 24,400 (210) General and Administrative Expenses 20,250 20,250 0 Operating Income 17,265 19,100 (1,835) Interest Expense 0 0 0 Income before 17,265 19,100 (1,835)Income Taxes Income Taxes 6,906 7,640 734 Net Income $ 10,359 $ 11,460 ($1,101) Actual net income is unfavorable compared to the budget. What is not known from looking at it is why  the variances occurred. For example, were more units sold? Was the selling price different than 
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Unformatted text preview: expected? Were costs higher? Or was it all of the above? These are the kinds of questions management needs answers to. In fact, an analysis of this budget report shows sales were actually 17,500 pickup trucks instead of the 17,000 pickup trucks planned; the average selling price was $14.80 per truck instead of the expected $15.00 per truck; and the cost per truck was $11.25 as budgeted....
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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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Pick Up Trucks Company Budget Report For the Second Quarter 20X1

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