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7-25 Flexible-budget and sales volume variances. Luster, Inc., produces the basic fillings used in many popular frozen desserts and treats vanilla and chocolate ice creams, puddings, meringues, and fudge. Luster uses standard costing and carries over no inventory from one month to the next. The ice-cream product group's results for June 2017 were as follows: Home Insert Page Layout Formulas Data Performance Report, June 2017 Actual Results Static Budget 3 JUnits (pounds) 320000 335.000 Revenues $2,012,500 $1,976,500 5 variable manufacturing costs 1.137.500 1,038,500 6 Contribution margin $875.000 $938.000 Sam Adler, the business manager for ice-cream products, is pleased that more pounds of ice cream were sold than budgeted and that revenues were up. Unfortunately, variable manufacturing costs went up, too. The bottom line is that contribution margin declined by $63,000, which is less than 3% of the budgeted revenues of $1,976,500. Overall, Adler feels that the business is running fine. Required: 1. Calculate the static-budget variance in units, revenues, variable manufacturing costs, and contribution margin 2. Break down each static-budget variance into a flexible-budget variance and a sales volume variance 1. and 2. Performance Report for Luster, Inc., June 2017 Flexible Budget Variancese Flexible Budget (3) Sales Volume Variances Actuale Static Budget Statice Budget Variance (6) = (1)-(5) (2) - (1) - (3) (4) = (3) - (5) (5) Units (pounds) Revenuese Variable mfg. costs Contribution margine Flexible-budget variance Sales-volume variance Static-budget variance Budgeted selling price Flexible-budget revenues Budgeted variable mfg. cost per unit se Flexible-budget variable mfg. costs =