Phoenix Company reports the following fixed budget. It is based on an expected production and sales volume of 15,000 units. $ 3,000,000 PHOENIX COMPANY Fixed Budget For Year Ended December 31 Sales Costs Direct materials Direct labor Sales staff commissions Depreciation-Machinery Supervisory salaries Shipping Sales staff salaries (fixed annual amount) Administrative salaries Depreciation-office equipment Income 1,035,000 225,000 60,000 300,000 250,000 90,000 235,000 241,000 195,000 $ 369,000 Problem 8-2A (Algo) Preparing a flexible budget performance report LO P1 Phoenix Company reports the following actual results. Actual sales were 18,000 units. $ 3,697,000 Sales (18,000 units) Costs Direct materials Direct labor Sales staff commissions Depreciation-Machinery Supervisory salaries Shipping Sales staff salaries (fixed annual amount) Administrative salaries Depreciation-office equipment Income $ 1,250,000 325,000 72,000 300,000 250,000 171,000 266,500 261,000 195,000 648,500 Required: Prepare a flexible budget performance report for the year. (Indicate the effect of each variance by selecting "Favorable" or "Unfavorable". Select "No variance" and enter "O" for zero variance.) Answer is complete but not entirely correct. PHOENIX COMPANY Flexible Budget Performance Report Flexible Actual Budget Results (18,000 (18,000 units) units) $ 3,600,000 $ 3,697,000 For Year Ended December 31 Variances Favorable/Unfavorable $ 97,000 Favorable Sales Variable costs Direct materials Direct labor Sales staff commissions Shipping 1,242,000 270,000 72,000 X 108,000 1,250,000 325,000 72,000 171,000 8,000 Unfavorable 55,000 Unfavorable 0 No variance 63,000 Unfavorable XX 1,692,000 1,908,000 1,818,000 1,879,000 126,000 Unfavorable 29,000 X Unfavorable > Total variable costs Contribution margin Fixed costs Depreciation-Machinery Supervisory salaries Sales staff salaries Administrative salaries Depreciation - Office equipment 300,000 250,000 235,000 241,000 195,000 300,000 250,000 266,500 261,000 195,000 0 0 31,500 20,000 0 No variance Unfavorable Unfavorable Unfavorable No variance Total fixed costs Income 1,221,000 687,000 1,272,500 $ 606,500 51,500 Unfavorable 80,500 Unfavorable $ $