1. What are the total Flexible Budget Varianceand Sales Volume Variance communicating?

2. Is there anyline-item variances that stand out to you? Why?

Description Streategic Budget Flexible Budget Sales Volume Variance Actual Results Flexible Budget Variance Variance Pounds produced and Sold 400,000 450,000 450,000 50,000 F Total Revenue 3,200,000 3,600,000 -400,000 3,555,000 -45,000 355,000 F Direct labor 336,000 378,000 -42,000 348,000 -30,000 12,000 U A 96,000 108,000 -12,000 108,000 0 12,000 B 240,000 270,000 -30,000 240,000 -30,000 0 Direct materials 580,000 652,500 -72,500 865,000 212,500 285,000 U C 80,000 90,000 -10,000 93,000 3,000 13,000 D 300,000 337,500 -37,500 532,000 194,500 232,000 E 200,000 225,000 -25,000 240,000 15,000 40,000 Variable OH 648,000 729,000 -81,000 750,000 21,000 102,000 U Total Variable Production Cost 1,564,000 1,759,500 -195,500 1,963,000 203,500 399,000 U Contribution Margin 1,636,000 1,840,500 -204,500 1,592,000 -248,500 -44,000 U Fixed Production Costs 800,000 800,000 0 810,000 10,000 10,000 U Gross Margin 836,000 1,040,500 -204,500 782,000 258,500 -54,000 U Total 2,364,000 2,559,500 -195,500 2,773,000 213,500 409,000 Sales Volume Variance Flexible Volume Variance -409,000 Strategic Budget Variance