Vet Health budgeted sales of 700,000 vials for August. At the end of the month, the controller revealed that actual results for August had deviated from the budget in several ways: Unit sales and production were 90% of plan. Actual average selling price decreased to $8.20. Productivity dropped to 90 vials per hour. Actual direct manufacturing labor cost was $15.20 per hour. Actual total direct material cost per unit increased to $3.90. Actual sales commissions were $0.70 per vial. Fixed overhead costs were $110,000 above budget. Calculate the following amounts for Vet Health for August 2020: Static-budget and actual operating income Static-budget variance for operating income Flexible-budget operating income Flexible-budget variance for operating income Sales-volume variance for operating income Price and efficiency variances for direct manufacturing labor Flexible-budget variance for direct manufacturing labor Comment on the analysis and variances.

Identify which of the twelve basic functions listed below fit the description given.

Aprice ceiling is “binding” if the price ceiling is set below the equilibrium price. suppose that the equilibrium price is $5. if a price ceiling is set at $6, this will not affect the market in any way since $5 remains a legally allowable price (since $5 < $6). a price ceiling of $6 is called a “non-binding” price ceiling. on the other hand, if the price ceiling is set at $4, the price ceiling is “binding” because the natural equilibrium price is $5 but that is no longer allowed. what happens when there is a binding price ceiling? at a price below the equilibrium price, quantity demanded exceeds quantity supplied. there is a shortage. normally, price increases eliminate shortages by increasing quantity supplied and decreasing quantity demanded. in this case, however, price increases are not allowed past the price ceiling. we therefore predict that the observed market price will be right at the price ceiling and there will be a permanent shortage. the observed quantity bought and sold will be dictated by the quantity supplied at the price ceiling. although consumers would like to buy more, there are no more units for sale

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