Daniliuc Ltd is based in North Habour and produces a singled machined part used extensively in boat building and repairs. At the start of the business, the owners have not thought much about using sophisticated costs methods. With increased competition more recently, the business has considered employing a system of flexible budgeting to effectively provide a better understanding of their budgets and variances. These figures are based on a budget of 1,000 parts in a month. Products are broadly made to order so you can assume that minimal inventory is held. $ $ 200 Selling price per unit Less: Costs Raw materials - 10kgs @ $5.50 per kg Wages - 3.5hours @ $20 per hour Salaries Insurance Total Costs Budgeted Profit 55 70 19 10 153 46 During the month of June 2020, a summarised income statement shows the following: $ $ Sales revenue 176,000 Less: Costs Raw materials - 8,100kgs @ $6 per kg 48,600 Wages 63,800 Salaries 22,500 Insurance 11,000 Total Costs 145,900 Actual Profit 30,100 Additional information: 8 . . Actual selling price for the machined part was increased by 10%. Wages costs for the month of June used the new rate of $22 per hour. Required a. Prepare a flexed budget and a variance analysis for Daniliuc Ltd for the month of June 2020, using the table below. Show all workings. (15 marks) Actual Flexed Variance Units 800 Sales Revenue 176,000 Less: Costs Raw materials - 10kgs @ $5.50 per kg 48,600 Wages - 3.5hours @ $20 per hour 63,800 Salaries 22,500 Insurance 11,000 Total Costs 145,900 Profit 30,100 b) For each of the variances identified in part a) above, provide a reason to explain each variance