Rogers Corporation prepared a budget last period that called for sales of 20,000 units at a price of $30 each.The production costs per unit were estimated to amount to $14.00 variable and $6.00 fixed.

All selling and administrative costs were fixed at $50,000.

During the period, production was 22,000 units.

The actual selling price was $33.00 per unit.

Actual variable costs were $16.00

per unit and actual fixed production costs totaled $66,000.

Selling and administrative costs were 10% higher than the budgeted amounts.

Required:

a) Show operating statements for the actual output, as well as a static budget and a flexible budget.

b) Explain what is indicated when comparing the operating statements.