Here is the data that Vroom-Vroom used for their budgets:					Here are the Actual Results in December and January:
Monthly Budget Data:					Actual Data:		December	January
Selling Price per uniit:	$ 70.00	each			Production (Units)		375,000	150,000
Raw Materail Cost	$ 30.00	each			Revenue		$ 26,300,000	$ 10,300,000
Packaging Costs	$ 10.00	each			Raw Materials		$ 11,348,500	$ 4,485,000
Electricity	$ 3.00	each			Packaging Materials		$ 3,720,000	$ 1,445,000
Waste and Other Costs	$ 5.00	each			Electricity		$ 1,125,000	$ 460,000
Salary and Wages Costs	$ 450,000	per month			Waste and Other Costs		$ 1,888,000	$ 750,000
Fringe Benefits	50%	of Salaries			Wages		$ 500,000	$ 450,000
Rent Costs	$ 500,000	per month			Fringe Benefits		$ 250,000	$ 225,000
Insurance Costs	$ 70,000	per month			Rent		$ 500,000	$ 500,000
Depreciation Costs	$ 250,000	per month			Insurance		$ 70,000	$ 75,000
					Depreciation		$ 250,000	$ 240,000

Vroom-Vroom estimated sales/production will be between 100,000 and 300,000 cars per month. Their static budget is based on 200,000 cars sold per month. Assume that all units produced in a month are also sold in that month. Vroom-Vrooms unit of production/sale is a car (unit/each).

Question 1: Prepare a static budget in Excel for Vroom-Vroom.

1. Show the static budget for December in Contribution Margin Income Statement format.
2. Compare Decembers static budget to Decembers actual results. Specify which line items are favorable or unfavorable and how much.
3. For Ingredient Costs and Packaging Costs, break out the Price and Volume Variances for December. Provide potential explanations for each one.
4. Show the static budget for January in Contribution Margin Income Statement format.
5. Compare Januarys static budget to Januarys actual results. Specify which line items are favorable or unfavorable and how much.
6. For Ingredient Costs and Packaging Costs, break out the Price and Volume Variances for January. Provide potential explanations for each one.