Accounting for Managers: Interpreting accounting information for decision-making

Table 15.4

Variance report

Std costper unit

Originalbudget

Std costper unit

Flexedbudget

Usage

qty

Act costper unit

Actual

Variance

Sales units

10,000

9,000

9,000

Selling price

£170

£170

£175

Revenue

£1,700,000

£1,530,000

£1,575,000

−

£45,000

Variable costsMaterials

Plastic

2 @ £1.50

30,000

2 @ £1.50

27,000

19,000

£1.40

26,600

400

Metal

1 @ £2

20,000

1 @ £2

18,000

10,000

£2.10

21,000

−

3,000

Wood

4 @ £0.75

30,000

4 @ £0.75

27,000

38,000

£0.70

26,600

400

Labour

Skilled

6 @ £15

900,000

6 @ £15

810,000

55,000

£15.25

838,750

−

28,750

Semi-skilled

3 @ £7.50

225,000

3 @

£7.50

202,500

26,000

£7.50

195,000

7,500

Variable overhead

6 @ £5

300,000

6 @ £5

270,000

55,000

£5.15

283,250

−

13,250

Total variable costs

£150.50

1,505,000

£150

.50

1,354,500

£154.58

1,391,200

−

36,700

Contribution

£19.50

195,000

£19.50

175,500

£20.42

183,800

−

8,300

Fixed costs

125,000

125,000

130,000

−

5,000

Net profit

70,000

50,500

53,800

−

3,300