Rundle Publications established the following standard price and costs for a hardcover picture book that company produces

.

Rundle planned to make and sell 31,000 copies of the book.

Required:

a. - d. Prepare the pro forma income statement that would appear in the master budget and also flexible budget income statements, assuming production volumes of 30,000 and 32,000 units. Determine the sales and variable cost volume variances, assuming volume is actually 32,000 units. Indicate whether the variances are favorable (F) or unfavorable (U). (Select "None" if there is no effect (i.e., zero variance).)

Standard price and variable costs Sales price Materials cost 36.40 8.20 Labor cost Overhead cost 4.10 6.10 Selling, general, and administrative costs Planned fixed costs 7.00 Manufacturing overhead Selling, general, and administrative $134,000 50,000 +A Master Budget Flexible Budgets Volume Variances Number of units 31,000 30,000 32,000 Variable manufacturing costs Fixed costs