Reference no: EM13482571

A retail department store used the following cost-volume relationship were used in developing a flexible budget for the company for the currnet year:
                                                                   yearly fixed expenses      variableexpenses per sales dollar
cost of merchandisesold.............................                                              $0.600
selling and promotionexpense....................     $210,000                            0.082
building occupancyexpense.......................       186,000                             0.022
buyingexpense..........................................        150,000                           0.040
deliveryexpense........................................         111,000                           0.010
credit andcollection.................................            72,000                           0.002
administrativeexpense..................................      531,000                          0.003
Totals......................................................      $1,260,000                       $0.759

management expected to attain a sales level of $12 million during the current year. At the end of the year, the actual results achieved by the company were:

net sales..............................................$10,500,00
cost of goodssold...............................    6,180,000
seliing and promoting expenses............   1,020,000
building occupancyexpenses...............       420,000
buyingexpenses.................................       594,000
deliveryexpense.................................        183,000
credit and collectionexpense...............          90,000
administrativeexpense........................       564,000

Write a statement evaluating the company's performance in relation to the plan reflected in the flexible budget.