Rooney Medical Equipment Company makes a blood pressure measuring kit. Jason McCoy is the production manager. The production departments static budget and actual results for Year 3 follow:

	Static Budget					Actual Results
Production in units	29,000 kits					30,400 kits
Direct materials		$	194,300				$	242,280
Direct labor			165,300					167,180
Variable manufacturing overhead			43,500					48,400
Total variable costs			403,100					457,860
Fixed manufacturing overhead			210,000					206,000
Total manufacturing cost		$	613,100				$	663,860

Required

a. Convert the static budget into a flexible budget.

b. Calculate the variances.