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Static budget income statement:
Sales Revenue $125,000
Variable Costs (75,000)
Contribution Margin 50,000
Fixed Cost (30,000)
Net Income $ 20,000
The budget was based on an expected sales volume of 5,000 units. Actual sales volume was 6,000 units.
1. The amount of net income based on a flexible budget of 6,000 units is expected to be
a. $24,000.
b. $26,000.
c. $30,000.
d. $45,000.
2. The sales revenue volume variance is
a. $25,000 favorable.
b. $10,000 unfavorable.
c. $4,000 unfavorable.
d. $6,000 favorable.
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