Phoenix Companys 2019 master budget included the following fixed budget report. It is based on an expected production and sales volume of 16,000 units.

PHOENIX COMPANY Fixed Budget Report For Year Ended December 31, 2019 Sales $ 3,600,000 Cost of goods sold Direct materials $ 1,120,000 Direct labor 240,000 Machinery repairs (variable cost) 80,000 DepreciationPlant equipment (straight-line) 300,000 Utilities ($64,000 is variable) 214,000 Plant management salaries 215,000 2,169,000 Gross profit 1,431,000 Selling expenses Packaging 96,000 Shipping 128,000 Sales salary (fixed annual amount) 260,000 484,000 General and administrative expenses Advertising expense 128,000 Salaries 241,000 Entertainment expense 90,000 459,000 Income from operations $ 488,000 Phoenix Companys actual income statement for 2019 follows.

PHOENIX COMPANY Statement of Income from Operations For Year Ended December 31, 2019 Sales (19,000 units) $ 4,338,000 Cost of goods sold Direct materials $ 1,346,000 Direct labor 292,000 Machinery repairs (variable cost) 86,000 DepreciationPlant equipment (straight-line) 300,000 Utilities (fixed cost is $147,500) 222,500 Plant management salaries 225,000 2,471,500 Gross profit 1,866,500 Selling expenses Packaging 111,750 Shipping 144,500 Sales salary (annual) 279,000 535,250 General and administrative expenses Advertising expense 135,000 Salaries 241,000 Entertainment expense 93,000 469,000 Income from operations $ 862,250 Required: 1. Prepare a flexible budget performance report for 2019. (Indicate the effect of each variance by selecting for favorable, unfavorable, and No variance.)