Problem 21-2A Preparing and analyzing a flexible budget performance report LO P1, P2, A1 Phoenix Company's 2019 master budget included the following fixed budget report. It is based on an expected production and sales volume of 18,000 units. $4,050,000 PHOENIX COMPANY Fixed Budget Report For Year Ended December 31, 2019 Sales Cost of goods sold Direct materials Direct labor Machinery repairs (variable cost) Depreciation-Plant equipment (straight-line) Utilities ($36,000 is variable) Plant management salaries Gross profit Selling expenses Packaging Shipping Sales salary (fixed annual amount) General and administrative expenses Advertising expense Salaries Entertainment expense Income from operations $1,260,000 360,000 54,000 315,000 196,000 230,000 2,415,000 1,635,000 72,000 108,000 270,000 450,000 129,000 251,000 110,000 490,000 $ 695,000 Phoenix Company's actual income statement for 2019 follows. $4,788,000 PHOENIX COMPANY Statement of Income from Operations For Year Ended December 31, 2019 Sales (21,000 units) Cost of goods sold Direct materials $1,486,000 Direct labor 429,000 Machinery repairs (variable cost) 55,000 Depreciation-Plant equipment (straight-line) 315,000 Utilities (fixed cost is $158,000) 199, 250 Plant management salaries 241,000 Gross profit Selling expenses Packaging 81,750 Shipping 119,000 Sales salary (annual) 288,000 General and administrative expenses Advertising expense 136,000 Salaries 251,000 Entertainment expense 113,500 Income from operations 2,725,250 2,062,750 488,750 500,500 $1,073,500 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