Hello Tutor

Can you please help me below questions?

Thank you.

Kevin Jarvis is the controller of Bitterroot Industries. Kevin prepared the following budgeted income statement at various levels of sales. After careful review of the budgeted income statements, and after discussions with the sales and production managers, the CEO determines that the best alternative is to base the budget on a sales volume of 30,000 units.

20,000 30,000 40,000

Sales $1,240,000 $1,860,000 $2,480,000

Variable costs

Direct material 340,000 510,000 680,000

Direct labor 300,000 450,000 600,000

Overhead 360,000 540,000 720,000

Total variable costs1,000,000 1,500,000 2,000,000

Contribution margin240,000 360,000 480,000

Fixed costs

Overhead 62,000 62,000 62,000

Rent 46,000 46,000 46,000

Insurance 28,000 28,000 28,000

Advertising 15,000 15,000 15,000

Total fixed costs 151,000 151,000 151,000

Operating income $89,000 $209,000 $329,000

Actual results for the year were 28,000 units, reflected in the following income statement:

28,000

Sales $1,764,000

Variable costs

Direct material 504,000

Direct labor 434,000

Overhead 509,600

Total variable costs1,447,600

Contribution margin316,400

Fixed costs

Overhead 64,200

Rent 45,800

Insurance 29,100

Advertising 14,000

Total fixed costs 153,100

Operating income$163,300

What is the flexible budget variance for direct material?

a.$28,000 favorable

b.$28,000 unfavorable

c.$6,000 favorable

d.$34,000 unfavorable

What is the flexible budget variance for variable overhead?

a.$5,600 favorable

b.$5,600 unfavorable

c.$30,400 favorable

d.$34,000 unfavorable