The financial results for one of the subunits of Factory Six ...

[TVarnum]

The financial results for one of the subunits of Factory Six Racing is presented in the partially completed performance evaluation report below.

Subunit - CobraST	Actual	Flexible Budget	Flexible Budget Variance (U or F)	Percentage* Variance (U or F)
Sales	$243,000	$225,000	​	​
Cost of goods sold	130,000	125,000	​	​
Gross margin	$113,000	$100,000	​	​
Operating expenses	26,000	25,000	​	​
Operating income before service department charges	$87,000	$75,000	​	​
Service department charges (allocated)	17,500	12,500	​	​
Operating income	$69,500	$62,500	​	​
​	​	​	​	​

* Flexible budget variance/Flexible budget

Required:

1.	Complete the performance report rounding to three decimal places.

2.	Based on the data presented, what type of responsibility centre is this subunit?

3.	Which items should be investigated if part of management's decision criteria is to investigate all

variances equal to or exceeding $5,000 and exceeding 10% ( both criteria must be met)?

[iman]

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[TVarnum]

Excellent

[ghepp]

Thanks for the timely response, appreciate it