The Washington Fish Company completed the flexible budget analysis for the second quarter, which is given below
Actual Results Flexible Budget Variance Flexible Budget Sales Volume Variance Static Budget
Units 12,870 0 12,870 1,070 F 11,800
Sales Revenue $62,790 $1,240 U $64,030 $3,990 F $60,040
Variable Costs 27,590 610 U 26,980 $1,770 U 25,210
Contribution Margin $35,200 $1,850 U $37,050 $2,220 F $34,830
Fixed Costs 34,290 230 U 34,060 $0 34,060
Operating Income/(Loss) $910 $2,080 U $2,990 $2,220 F $770
Which of the following statements would be a correct analysis of the sales volume variance for operating income?
A) decrease in sales price per unit
B) increase in variable cost per unit
C) increase in sales volume
D) increase in fixed costs
C
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