Carlson Enterprises manufactures tires for the Formula 1 motor racing circuit. For August 2020, it budgeted to manufacture and sell 3,700 tires at a variable cost of $72 per tire and total fixed costs of $56,500. The budgeted selling price was $110 per tire. Actual results in August 2020 were 3,500 tires manufactured and sold at a selling price of $111 per tire. The actual total variable costs were $280,000, and the actual total fixed costs were $51,500. Requirement 1. Prepare a performance report with a flexible budget and a static budget. Begin with the actual results, then complete the flexible budget columns and the static budget columns. Label each variance as favorable or unfavorable. (For variances with a $0 balance, make sure to enter "0" in the appropriate field. If the variance is zero, not select a label.) Actual Flexible-Budget Flexible Sales-Volume Static Variances Results 2,900 Budget 2,900 Budget 3,200 0 Units sold Variances 300 33,600 Revenues $ $ 324,800 $ $ 327,700 $ 255,200 358,400 256,000 Variable costs 232,000 24,000 Contribution margin 72,500 2,900 F 23,200 U 20,300 U 2,500F 17,800 U 9,600 92,800 52,500 102,400 52,500 Fixed costs 50,000 $ 22,500 $ 40,300 9,600 $ Operating income 49,900 Requirement 2. Comment on the results in requirement 1. The total static-budget variance in operating income is $ 27,400 U. There is a(n) unfavorable total flexible-budget variance and a(n) unfavorable sales-volume variance. The sales volume variance arises solely because actual units manufactured and sold were less than the budgeted 3,200 units. The flexible-budget variance in operating income is due primarily to the increase in unit variable costs