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The actual information pertains to the month of September. As part of the budgeting process, Kriger Fencing Company developed the following static budget for September. Kriger is in the process of preparing the flexible budget and understanding the results.
Actual Flexible Static
Results Budget Budget
Sales volume (in units) 10,000 12,500
Sales revenues $500,000 $ $625,000
Variable costs 256,000 $ 300,000
Contribution margin 244,000 $ 325,000
Fixed costs 229,000 $ 225,000
Operating profit $ 15,000 $ $ 100,000
The primary reason for low operating profits was .
A) lower sales volume than planned
B) a poor management accounting system
C) increased fixed costs
D) the variable-cost variance
Answers: 1
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The actual information pertains to the month of September. As part of the budgeting process, Kriger...
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