Western Outfitters Projected Sales of 75,000 Units for the Year

Multiple Choice

Western Outfitters projected sales of 75,000 units for the year 2015 at a unit sale price of $12.00. Actual sales in 2015 was 72,000 units, at $14.00 per unit. Variable costs were budgeted at $4.00 per unit; actual variable cost was $4.75 per unit. Budgeted fixed costs totaled $375,000 while actual fixed costs amounted to $400,000. What is the flexible budget variance for operating income?

A) $48,000 unfavorable
B) $65,000 favorable
C) $65,000 unfavorable
D) $41,000 favorable