Reference no: EM132898315

Question - Cherokee Manufacturing Company established the following standard price and cost data:

Sales price $12.00 per unit

Variable manufacturing cost $7.20 per unit

Fixed manufacturing cost $3,600 total

Fixed selling and administrative cost $1,200 total

Cherokee planned to produce and sell 2,000 units. Actual production and sales amounted to 2,200 units.

Assume that the actual sales price is $11.76 per unit and that the actual variable cost is $6.90 per unit. The actual fixed manufacturing cost is $3,000, and the actual selling and administrative costs are $1,230.

Required - Determine the flexible budget variances and classify the effect of each variance by selecting favorable (F) or unfavorable (U).