Casco Co. planned to produce and sell 40,000 units. At that volume level, variable costs are determined to be $320,000 and fixed costs are $30,000. The planned selling price is $10 per unit. Casco actually produced and sold 42,000 units.

Required:

Using a contribution margin format:

(a) Prepare a fixed budget income statement for the planned level of sales and production.

(b) Prepare a flexible budget income statement for the actual level of sales and production.