Barnes Entertainment Corpora­tion prepared a master budget for the month of November that was based on sales of 200,000 board games. The budgeted income statement for the period is as follows.

During November, Barnes produced and sold 190,000 board games. Actual results for the month are as follows.

Required

a. Prepare a flexible budget for November.

b. Calculate Barnes's static budget Variance for November.

c. Will the static budget variance that you calculated in part (b) be useful to management? Why or why not?

d. Based on the available information, prepare a performance report for management.

e. Comment on the results of your report.

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Sales Revenue $2,400,000 Variable expenses Direct materials $750,000 Direct labor 250,000 Variable overhead 520,000 Total variable expenses 1,520,000 Contribution margin Fixed Expenses 880,000 Fixed overhead 220,000 Fixed selling and administrative expenses 435,000 Total fixed expenses 655,000 Operating income $ 225,000