budgeting Question ....

ms sadat
ms sadat Registered Posts: 39 Regular contributor ⭐
In workbook,in practice assessment 2 question 2.2 which is oprating statement for may 2009 .in the answer part we have this ...( I have reviewed the results for may 2009 .profit in the month was £807200 driven by a 10% price improvment over budget and increased volume .After flexing the original budget to allow for the increased volume .we are reporting adverse expense variances of £44000.
what i dont get is where and how we got the £44000 ?

if anybody could help ,appreciated as i have the exam in 2days please


  • GreenMousey
    GreenMousey Registered Posts: 154 Dedicated contributor 🦉
    I don't have that book, but with you saying "expenses variance" have they added them all together & taken away any favourable ones to give them a total rather than just one area?
  • SandyHood
    SandyHood Registered, Moderator Posts: 2,034 mod
    I got variances as follows:
    Variable costs £31,000 adverse
    Fixed costs £13,000 adverse

    That adds up to £44,000 adverse

    Have you attempted this question before looking at the answer on the website?
  • ms sadat
    ms sadat Registered Posts: 39 Regular contributor ⭐
    thank you guys !
    SandyHood , i tried your way and it works that way thx
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