The actual information pertains to the month of January. As a part of the budgeting process, Gina Door Knobs Company developed the following static budget for January. Gina Door Knobs is in the process
of preparing the flexible budget and understanding the results.
Actual
Results
Flexible
Budget
Static Budget
Sales volume (in units)
22,000
23,500
Sales revenues
900,000
?
1.292,500
Variable costs
360,000
?
470.000
Contribution margin
540,000
?
686,090
Fixed costs
275,300
?
269,500
Operating profit
264,700
?
416,590
The flexible budget will report
for operating profits