Part A. 

A manufacturing company reports the following fixed budget and actual results for the past year. The fixed budget uses a selling price of \(\$ 40\) per unit and variable costs of \(\$ 8\) per unit. Prepare a flexible budget performance report for the past year. Label variances as favorable \((\mathrm{F})\) or unfavorable \((\mathrm{U})\).

Part B. 

A manufacturer reports the following for May when it produced and sold 8,000 units. Prepare a flexible budget performance report at the activity level of 8,000 units. Compute variances and label them as favorable \((F)\) or unfavorable \((U)\).

Transcribed Image Text:

Sales... Variable costs Fixed costs... Fixed Budget (20,000 units) $800,000 160,000 500,000 Actual Results (24,000 units) $972,000 240,000 490,000