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ATC-22-1-Static versus flexible budget variances Vince jacobs is the manufacturing production supervisor for high-five inline skates company.trying to explain why he did not get the year-end bonus he has expected,he told his wife,?this is the dumbest place I ever worked. Last year the company set up this budget assuming it would sell 200,000 skates. Well,it sold only 190,000. The company lost money and gave me a bonus for not using as much materials and labor as was called for in the budget. This year, the company has the same 200,000 goal and it sells 210,000. The company?s making all kinds of money. You?d think I?d get this big fat bonus. Instead,management tells me I used more materials and labor than we budgeted. They say the company would have made a lot more money if I?d stayed within my budget. I guess I gotta wait for another bad year before I get a bonus. Like I said,this is the dumbest place I ever worked.? Note:combine variable cost(including materials,labor and overhead). High five companys master budget and the actual results for the most recent year of operating activity follow. A) Did high-five increase unit sales by cutting proces or by using some other strategy? B) Is Mr.Jacobs correct in his conclusion that something is wtrong with the company?s performance evaluation process?If,so what do you suggest be done to improve the system? C) Prepare a flexible budget and recompute the budget variances D) Explain what might have caused the fixed costs to be different from the amount budgeted. E) Is the fixed overhead volume variance favorable or unfavorable?Explain the effect of this variance on the cost of each set of inline skates. Accounts Assignment Help, Accounts Homework help, Accounts Study Help, Accounts Course Help


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