Enterprises manufactures tires for the Formula 1 motor racing circuit. For August

20142014?,

it budgeted to manufacture and sell

2 comma 8002,800

tires at a variable cost of

$ 73$73

per tire and total fixed costs of

$ 56 comma 500$56,500.

The budgeted selling price was

$ 107$107

per tire. Actual results in August

20142014

were

2 comma 6002,600

tires manufactured and sold at a selling price of

$ 110$110

per tire. The actual total variable costs were

$ 208 comma 000$208,000?,

and the actual total fixed costs were

$ 53 comma 500$53,500.

Requirements

1. Prepare a performance report that uses a flexible budget and a static budget.

2. Comment on the results in requirement 1.

Requirement 1. Prepare a performance report that uses 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, do not select a? label.)

	Actual
	Results
Units sold
Revenues
Variable costs
Contribution margin
Fixed costs
Operating income

Requirements 1 and 2