Pebco Company's 2011 master budget included the following fixed budget report. It is based on an expected production and sales volume of 18,000 units Fixed Budget Report Sales Cost of goods sold $3,600,000 Direct materials Direct labor Machinery repairs (variable cost) Depreciation plant equipment Utilities ($50,000 is variable) Plant management salaries $ 1,005,000 255,000 75,000 315,000 200,000 215,0002,065,000 Gross profit Selling expenses 1,535,000 Packaging Shipping Sales salary (fixed annual amount) 80,000 260,000 445,000 amoun10500 General and administrative expenses Advertising expense Salaries 128,000 251,000 100,000 479,000 Entertainment expense Income from operations S 611,000 Pebco Company's actual income statement for 2011 follows. PEBCO COMPANY Statement of Income from Operations For Year Ended December 31, 2011 Sales (21,000 units) Cost of goods sold $4,248,000 Direct materials Direct labor Machinery repairs (variable cost) $1.188.500 305,500 78,500 Peboo Company's actual income statoment for 2011 follows Statement of Income from Operations Sales (21,000 units) Cost of goods sold 4,248,000 Direct materials Direct labor Machinery repairs (variable cost) Depreciation-plant equipment Utilities (fixed cost is $147,000) Plant management salaries $1,188,500 305,500 78,500 315,000 204,833 225,0002,317,333 Gross profit Selling expenses 1,930,667 Packaging Shipping Sales salary (annual) 91,083 114,500 277,000482,583 General and administrative expenses Advertising expense 35,000 251,000 04,000 490,000 IN Entertainment expense Income from operations $ 958,084 Un Required: 1. Prepare a flexible budget performance report for 2011. (Do not round your intermediate calculations and round your final answers to nearest dollar amount. Indicate the effect of each variance by selecting "F for favorable, "U" for unfavorable, and "None" for no offect (i.e., zero variance). Input all amounts as positive values. Leave no cells blank- be certain to enter "O wherever required. Omit the "$ sign in your response.) PEBCO COMPANY Flexible Budget Performance Report For Year Ended December 31. 2011 Flexible Actual Bo $l 21,000| $1 21,000) $1 Bo | 4,200,000] [ 1,188,500.0 | Bo 1,172,500. 305,500]8,000 o Sales Variable costs . 16,000 o Direct materials Direct labor Machinery repairs 9,000 500 D58,33391,083 2.250 297,500 O 78,500 O Bo-...87,500. 57,833 Utilities Packaging 93,3331 114,500 8,000 Shipping Total variable costs 831,667 1,835,916 4,249 DO 2.368.333 2412.084 43,71 Contribution margin Fixed costs Depreciation-plant equioment315,000 315,000 o o None Do .. 150,000 O 147,000 O Lim 3,000 0 Utilities Plant management salaries215,000 225,000 0 10,000 0 Sales salary Bo 260,0000 277,0000 17,000 O128,000135,000 O7000 0 Advertising expense Salaries None 251.0000 251.000 a
