Phoenix Company's 2019 master budget included the following fixed budget report. It is based on an expected production and sales volume of 15,000 units. $ 3,000,000 PHOENIX COMPANY Fixed Budget Report For Year Ended December 31, 2019 Sales Cost of goods sold Direct materials Direct labor Machinery repairs (variable cost) Depreciation-Plant equipment (straight-line) Utilities ($45,000 is variable) Plant management salaries Gross profit Selling expenses Packaging Shipping Sales salary (fixed annual amount) General and administrative expenses Advertising expense Salaries Entertainment expense Income from operations $ 975,000 225,000 60,000 300,000 195,000 200,000 1,955,000 1,045,000 75,000 105,000 250,000 430,000 125,000 241,000 90,000 456, 000 159,000 Phoenix Company's actual income statement for 2019 follows. $ 3, 648,000 PHOENIX COMPANY Statement of Income from Operations For Year Ended December 31, 2019 Sales (18,000 units) Cost of goods sold Direct materials $1,185,000 Direct labor 278,000 Machinery repairs (variable cost) 63,000 Depreciation-Plant equipment (straight-line) 300,000 Utilities (fixed cost is $147,500) 200, 500 Plant management salaries 210,000 Gross profit Selling expenses Packaging 87,500 Shipping 118,500 Sales salary (annual) 268,000 General and administrative expenses Advertising expense 132,000 Salaries 241,000 Entertainment expense 93,500 Income from operations 2,236,500 1, 411,500 474,000 466, 500 471,000 $ Required: 1. Prepare a flexible budget performance report for 2019. (Indicate the effect of each variance by selecting for favorable, unfavorable, and No variance.) PHOENIX COMPANY Flexible Budget Performance Report For Year Ended December 31, 2019 Flexible Budget Actual Results Variances Fav. / Unfav. Sales Variable costs Direct materials Direct labor Machinery repairs Utilities Packaging Shipping 0 0 Total variable costs Contribution margin Fixed costs DepreciationPlant equipment (straight-line) Advertising expense Entertainment expense Plant management salaries Utilities Sales salary Salaries 0 0 Total fixed costs Income from operations