Question

Global Engineering's actual operating income for the current year is $50,000. The flexible budget operating income for actual volume achieved is $40,000, while the static budget operating income is $53,000. What is the sales volume variance for operating income

Answer 1

$13,000 Unfavorable

Step-by-step explanation:

Calculation for the sales volume variance for operating income of Global Engineering's

Using this formula

Sales volume variance for operating income=Static budget operating income -Fexible budget operating income

Where,

Static budget operating income =$53,000

Fexible budget operating income=$40,000

Let plug in the formula

Sales volume variance for operating income=$53,000-$40,000

Sales volume variance for operating income=$13,000 Unfavorable

Therefore the sales volume variance for operating income will be $13,000 Unfavorable