Gargantua PLC has produced the following budget and actual information (Table Al.7).

a) Prepare a traditional budget versus actual report using the above figures.

b) Prepare a flexible budget for Gargantua.

c) Calculate all sales and cost price and efficiency variances.

d) Reconcile the original budget and actual profit figures using the variance analysis.

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Table A1.7 Gargantua budget and actual Budget Actual Sales units Price per unit Direct materials 10,000 37.10 11,000 36 Magna - per unit 4 kg @ 1.50/kg Carta - per unit Labour-per unit Fixed costs 1 kg @ 5/kg 2.5 hours @ 7 75,000 46,500 kg-cost 67,425 11,500 kg cost 58,650 26,400 cost 187.440 68,000