Phoenix Company's 2019 master budget included the following fixed budget report. It is based on an expected production and sales volume of 17,000 units. $3, 825,000 PHOENIX COMPANY Fixed Budget Report For Year Ended December 31, 2019 Sales Cost of goods sold Direct materials $1,020,000 Direct labor 340,000 Machinery repairs (variable cost) 68,000 Depreciation-Plant equipment (straight-line) 330,000 Utilities ($51,000 is variable) 211,000 Plant management salaries 200,000 a. Gross profit Selling expenses Packaging 85,000 Shipping shin 119,000 Sales salary (fixed annual amount) 270,000 General and administrative expenses Advertising expense 126,000 Salaries 241,000 Entertainment expense 100,000 Income from operations 2,169,000 1,656,000 474,000 467,000 $ 715,000 Phoenix Company's actual income statement for 2019 follows. $4,578,000 PHOENIX COMPANY Statement of Income from Operations For Year Ended December 31, 2019 Sales (20,000 units) Cost of goods sold Direct materials $1,216,000 Direct labor 407,000 Machinery repairs (variable cost) 72,000 Depreciation-Plant equipment (straight-line) 330,000 Utilities (fixed cost is $157,500) 216, 750 Plant management salaries 210,000 Gross profit Selling expenses Packaging 97,500 Shipping shin 132,500 Sales salary (annual) 286,000 General and administrative expenses Advertising expense 135,000 Salaries 241,000 Entertainment expense 103,500 Income from operations 2,451,750 2,126,250 516,000 479,500 $1,130, 750 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. Variable costs Fixed costs Froblem 21-2A i 1 Advertising expense Salaries Entertainment expense Income from operations 126,000 241,000 100,000 467,000 $ 715,000 oints Phoenix Company's actual income statement for 2019 follows. eBook $4,578,000 Print References PHOENIX COMPANY Statement of Income from Operations For Year Ended December 31, 2019 Sales (20,000 units) Cost of goods sold Direct materials $1,216,000 Direct labor 407,000 Machinery repairs (variable cost) 72,000 Depreciation-Plant equipment (straight-line) 330,000 Utilities (fixed cost is $157,500) 216, 750 Plant management salaries 210,000 Gross profit Selling expenses 97,500 132,500 Sales salary (annual) 286,000 General and administrative expenses Advertising expense 135,000 Salaries 241,000 Entertainment expense 103,500 Income from operations 2,451,750 2,126,250 Packaging Shipping 516,000 479,500 $1,130,750 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. Variable costs Fixed costs
