Campbell Publications established the following standard price and costs for a hardcover picture book that the company produces.

$\backslash$table$[[$Standard price and variable costs,$36\mathrm{.}40],[$Sales price,$8\mathrm{.}30],[$Materials cost$,4\mathrm{.}30],[$Labor cost$,5\mathrm{.}50],[$Overhead cost$,6\mathrm{.}60],[$Selling$,$ general, and administrative costs,$129,000],[$Planned fixed costs,$48,000]]$

Campbell planned to make and sell $37,000$ copies of the book.

Required:

a$.-$ d$.$ Prepare the pro forma income statement that would appear in the master budget and also flexible budget income statements, assuming production volumes of $36,000$ and $38,000$ units. Determine the sales and variable cost volume variances, assuming volume is actually $38,000$ units. Indicate whether the variances are favorable $($F$)$ or unfavorable $($U$).$

Note: Select "None" if there is no effect $($i$.$e$.,$ zero variance$).$