Lasting Bubbles, Inc. produces multicolored bubble solution used for weddings and other events. The company sold 60,000 bubble kits during July, and its actual operating income was as follows: Click the icon to view the actual income statement.) The company's flexible budget income statement for July follows: E: (Click the icon to view the flexible budget income statement.) Read the requirements. - X Data Table Data Table Lasting Bubbles, Inc. Income Statement Lasting Bubbles, Inc. Flexible Budget Income Statement Month Ended July 31 Month Ended July 31 $ Sales revenue Flexible 194,000 Variable expenses Budget per Output Cost of goods sold $ 75,400 Unit Sales commissions 18,100 Output Units (Kits) 55.000 60,000 65,000 Utility expense 6,000 Sales revenue $ 3.10 $ 170,500 $ Fixed expenses 186,000 $ 201,500 Variable expenses 32,200 Salary expense Depreciation expense 1.25 Cost of goods sold 68,750 75,000 81,250 20,000 0.25 Sales commissions 13.750 Rent expense 15,000 16,250 14,350 7,000 0.10 5,500 6,000 6,500 Utility expense Total expenses. $ 173,050 Utility expense Fixed expenses Salary expense Depreciation expense Rent expense 30,000 30,000 33,000 $ 20,950 Operating income 20,000 20,000 23,000 15,000 15,000 7,000 19,000 7,000 7,000 Utility expense Print | Done Total expenses $ 160,000 $ 168,000 $ 186,000 $ 10,500 $ 18,000 $ 15,500 Operating income Requirement 1. Prepare the income statement performance report. Note: The master budget was based on expected sales volume of 55,000 bubble kits. (For accounts with a 0 balance, make sure to enter "0" in the appropriate column. Label each variance as favorable (F) or unfavorable (U). A variance of zero is considered favorable.) Lasting Bubbles, Inc. Income Statement Performance Report For the month ended July 31 Actual Flexible Volume Master Flexible Budget Variance Budget Variance Budget Output units Sales revenue Variable expenses Cost of goods sold Sales commissions expense Utility expense Fixed expenses Salary expense Depreciation expense Rent expense Utility expense Total expenses Operating income Requirement 2. What accounts for most of the difference between actual operating income and master budget operating income? The for operating income is larger than the . Most of the difference between master budget operating income and actual operating income resulted from v bubble kits than expected. Requirement 3. What is Lasting Bubbles' master budget variance for operating income? Explain why the income statement performance report provides Lasting Bubbles' managers with more useful information than the simple master budget variance. What insights can Lasting Bubbles' managers draw from this performance report? This means that operating income is Lasting Bubbles' master budget variance for operating income is than expected. Choose two reasons why the income statement performance report provides Lasting Bubbles' managers with more information than the simple master budget variance. These variances suggest that the marketing department did a V by selling kits than expected, at a sale price than expected