Candy Cane Company At the beginning of the holiday season, Candy Cane Company estimated that sales would be 50,000 boxes of chocolate. Actual sales totaled 70,000 boxes of chocolate. The product manager expected a large bonus based upon the additional income that a 40% increase in sales would provide. Imagine her surprise upon seeing the following report: Master Budget Actual Results Number of boxes 50,000 70,000 Sales revenues $250,000 $300,000 Less variable costs: Materials 60,000 82,000 Labor 50,000 67,000 Overhead 25,000 36,000 S,G,&A 10,000 15,000 Total variable costs 145,000 200,000 Contribution margin 105,000 100,000 Less fixed costs: Manufacturing 15,000 16,000 S,G,&A 30,000 28,000 Total fixed costs 45,000 44,000 Net income $60,000 $56,000 The company's owner is very upset charging that the product manager did such a poor job of controlling costs. Required: 1.) Prepare a performance report that can be used to evaluate the owner's charge that the product manager did a poor job of controlling costs. Be sure to label variances as favorable or unfavorable. 2.) Is the owner justified in charging the manager with poor cost control? Why or why not?