Problem 2 Performance reporting Crafts Inc., is a manufacturer of furniture The company has 2 responsibility centers: Production and Selling and Distribution. Production and administration are cost centers while Selling and Distribution is a profit center Presented below are the budgeted and actual contribution income statement for October along with applicable unit information. Budgeted unit information: Units Sale price per unit 900 $250 Direct material per unit Direct labor per unit Variable manufacturing overhead per unit Variable selling and distribution per unit $50 $20 $15 60 Actual Units 1,000 Craft Inc. Budgeted Contribution Income Statement For Month of October Sales $ 225,000 Less Variable costs Variable cost of goods sold Direct materials Direct labor Manufacturing overhead $45,000 18,000 13,500 $ 76,500 Selling and distribution Contribution Margin 130,500 94,500 54,000 Less Fixed Costs Manufacturing overhead Selling and Distribution 40,000 30,000 70,000 Net Income 24,500