I'm having trouble figuring out the production volume variance under requirement 1 and I also have no idea what to do for requirement 2.

Osborne is a manufacturer of magic kits. It uses absorption costing based on standard costs and reports the following data for 2017: (Click the icon to view the data.) There are no price, spending, or efficiency variances. Actual operating costs equal budgeted operating costs. The production-volume variance is written off to cost of goods sold. For each choice of denominator level, the budgeted production cost per unit is also the cost per unit of beginning inventory. Read the requirements. Data Table Theoretical capacity 287,500 units 240,000 units Practical capacity Normal capacity utilization Selling price Beginning inventory Production Sales volume Variable budgeted manufacturing cost Total budgeted fixed manufacturing costs Total budgeted operating (non-manuf.) costs (all fixed) 215,625 units $45 per unit 30,000 units 235,000 units 250,000 units $5 per unit $2,760,000 $260,000 Requirement 1. What is the production-volume variance in 2017 when the denominator level is (a) theoretical capacity, (b) practical capacity, and (c) normal capacity utilization? Begin by determining the formula that is used to calculate the production-volume variance. (Abbreviations used: Bdgt = Budgeted, Mfg. = Manufacturing.) Production- Total bdgt fixed mfg costs -( Fixed mfg overhead rate Actual production ) = volume variance Next calculate the production-volume variance for each denominator level (a) theoretical capacity, (b) practical capacity, and (c) normal capacity utilization. Label each variance as favorable (F) or unfavorable (U). Production- volume variance U Capacity type (a) Theoretical (b) Practical (c) Normal $ 504,000 57,500 248,000 U F. Requirement 2. Prepare absorption costing-based income statements for Osborne Corporation using theoretical capacity, practical capacity, and normal capacity utilization as the denominator levels. Prepare the income statements one at a time, beginning with theoretical. Label each variance as favorable (F) or unfavorable (U). Theoretical Revenue Cost of goods sold Beginning inventory Variable manufacturing costs Allocated fixed mfg overhead Cost of goods available for sale Ending inventory Production-volume variance Total cost of goods sold Gross margin Operating costs Operating income (loss)