BAM Corp. prepared a budget last period that called for sales of 30,000 units at a price of $10 each. The costs per unit were estimated to amount to $5 variable and $2 fixed. During the period, production was exactly equal to actual sales of 20,000 units. The selling price was $9.00 per unit. Variable costs were $5.50 per unit. Fixed costs actually incurred were $65,000. Required:

a) Explain the significance of the comparisons.

b.) Prepare operating statements for the actual output, as well as a static budget and a flexible budget.