QUESTION 2 (30 minutes, 17 marks) Fertilizer King Ltd. manufactures and sells two brands of fertilizer; regular and premium. Last month the vice president of marketing noticed that the actual selling price per KG differed from the budgeted selling price per KG for both grades. The regular grade sold for $1.15 per KG but was budgeted to sell for $1.20 per KG. However the premium grade sold for $1.40 per KG even though its budgeted selling price was $1.35 per KG. The contoller suggested those differences would probably be offset by the differences in the variable costs between actual and budget. The actual variable cost per KG of regular fertilizer was $1.05 and its budgeted amount was set at $1.00 per KG. Actual variable cost per KG of premium fertilizer was $1.10 and the budgeted variable cost per KG of premium fertilizer was $1.20. Not to worry said head of sales as the actual sales of regular fertilizer turned out to be 11,000 KG and we only budgeted to sell 10,000 KG of regular fertilizer. Furthermore, we actually sold 9,000 KG of premium fertilizer even though we budgeted to sell only 8,000 KG. The vice president was still concerned as the actual market size turned out to be 60,000 KG and Fertilizer King budgeted for a one third market share. REQUIRED: 1. Calculate the following variances for contribution margin in TOTAL and for EACH brand of fertilizer: (ONLY round your final variances to the nearest dollar) (See Appendix 1). a.static budget b. sales volume flexible budget d. sales quantity e. sales mix c. 2. Calculate the total market share and market size variance for contribution margin