MultiCorp is a French-based company with operations in the United Kingdom. In determining the budget for 2001, MultiCorp looks at its historical performance in the United Kingdom and notes that for March 2000, its operations were as follows:

In trying to establish the budget in British pounds for March 2001, MultiCorp does not anticipate a change in fixed costs, but its direct cost of materials and labor are expected to rise 10 percent, and its selling price is expected to rise by 15 percent.

At the time the budget is established, the spot rate (hypothetically) is FF7.6 per pound, and the projected average exchange rate for March 2001 is FF7.5 per pound.

At the end of March 2001, MultiCorp’s management looked at actual results and discovered the following: the actual average exchange rate was FF7.7, the selling price £112, and the cost per unit of direct materials and labor was £90 per unit. A total of 4,800 units were sold.

Determine the sales volume variances, the flexible budget variances, the foreign exchange variances, and the total static budget variances in British pounds for the following budget translation techniques according to the Lessard and Lorange model:

a. A-1

b. A-3

c. P-2

d. P-3

e. E-3

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Number of units sold Direct cost of materials and labor Fixed manufacturing costs Selling price 5,000 400,000 350,000 100 per unit