Static and Actuals IS VERITAS Fountain Pens, LLC Income Statement (Static Budget and Actual Results) For the year ended December 31, 2022 / unit Static Budget Sales Variable Costs Cost of Goods Sold Direct Material Direct Labor Wages Actuals units $ 50.00 $ 25,740 1,287,000 $ 29,858 1,055,340 4.87 125,354 145,410 16.26 418,532 468,756 Indirect Cost Allocation 11.38 292,921 246,053 Commissions Expense 3% 1.50 38,610 31,660 Total Variable Costs 34.01 875,417 891,879 Contribution Margin 15.99 411,583 163,461 Fixed Costs Advertising Expense Insurance Expense Selling & Admin. Expense Bad Debt Expense Depreciation Expense Total Fixed Costs Operating Income 64,160 57,744 22,000 22,440 212,640 227,524 25,760 22,668 36,000 35,280 360,560 365,656 $ 51,023 $ (202,195) Veritas Variance Analysis Work File (1) Variance Analysis Sales Variable Costs Cost of Goods Sold Direct Material VERITAS Fountain Pens, LLC Income Statement Variances For the year ended December 31, 2022 Veritas Variance Analysis Work File (1) Flexible Budget Static Budget Volume Variances F/U Flexible Budget Variances F/U Actuals units 25,740 1,287,000 29,858 1,055,340 125,354 Direct Labor Wages 418,532 Indirect Cost Allocation 292,921 Commissions Expense 3% 38,610 Total Variable Costs 875,417 Contribution Margin 411,583 Fixed Costs Advertising Expense 64,160 Insurance Expense 22,000 Selling & Admin. Expense 212,640 Bad Debt Expense 25,760 Depreciation Expense 36,000 Total Fixed Costs 360,560 Operating Income 51,023 145,410 468,756 246,053 31,660 891,879 163,461 57,744 22,440 227,524 22,668 35,280 365,656 (202,195) Static Budget Variances F/U Selected Variance Explanations Required: Of course you do not have knowledge of what occurred exactly, but draft a possible explanation that could account for the variance (a hypothetical [reason). Limit to 1-2 complete sentences. Fragment statements will not receive credit. Volume Variance for Sales Flexible-Budget Variance for Sales Volume Variance for Direct Labor Flexible-Budget Variance for Direct Labor Volume Variance for Selling & Admin. Expense Flexible-Budget Variance for Selling & Admin. Expense Variance Analysis Level "0" Variance in Operating Income Veritas Variance Analysis Work File (1)