Taylor Products Inc

Multiple Choice

Taylor Products Inc. has an $5,000 unfavorable flexible budget variance for October. Which of the following statements is true, if October's flexible budget net operating income was $175,000?

A) Taylor's static budget must have showed a net operating income of $180,000.
B) Taylor's static budget must have showed a net operating income of $170,000.
C) Taylor's actual net operating income must have been $180,000.
D) Taylor's actual net operating income must have been $170,000.