1. Pipe Company makes professional Pipes. The profit plan and actual results for the previous year, 2020, are as follows:

	Actual Results		Profit Plan
	Volume	Pounds	Volume	Pounds
Sales	30,000	360,000	32,000	480,000
Cost of Goods Sold
Raw material (KG)	3,200	64,000	3,000	45,000
Raw material (L)	7,500	75,000	5,000	80,000
Labor (Hours)	4,000	92,000	5,000	125,000
Contribution Margin		129,000		230,000
Other costs
Energy		15,000		25,000
Maintenance		6,000		12,000
Depreciation		10,000		20,000
Selling expenses		20,000		25,000
Advertising		5,000		10,000
Profit before interest and tax		73,000		138,000

The plant manager, Khaled, has instructed the plant management accountant to prepare a detailed report to be sent to corporate headquarters comparing each components actual result with the amounts set forth above in the annual budget.

Required: Explain the difference between the expected and actual profit. Show your workings.

please write there to copy