Koch Medical Equipment Company makes a blood pressure measuring kit. Albert Kaiser is the production manager. The production departments static budget and actual results for 2015 follow.

Static Budget Actual Results Production in units 37,000 kits 39,200 kits Direct materials $ 273,800 $ 328,780 Direct labor 236,800 244,180 Variable manufacturing overhead 55,500 62,200 Total variable costs 566,100 635,160 Fixed manufacturing overhead 212,000 207,900 Total manufacturing cost $ 778,100 $ 843,060

Required:

a.

Convert the static budget into a flexible budget. (Do not round intermediate calculations.)

b.

Calculate variances and indicate the effect of each variance by selecting favorable (F) or unfavorable (U). (Select "None" if there is no effect (i.e., zero variance).)