E23-17 Preparing an income statement performance report [20–25 min]
Top managers of Kyler Industries predicted 2012 sales of 14,800 units of its product at
a unit price of $8.50. Actual sales for the year were 14,600 units at $10.50 each.
Variable costs were budgeted at $2.20 per unit, and actual variable costs were $2.30
per unit. Actual fixed costs of $41,000 exceeded budgeted fixed costs by $4,500.
Requirement
1. Prepare Kyler’s income statement performance report. What variance contributed
most to the year’s favorable results? What caused this variance?
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