The company uses the following performance report for management evaluation.

	DOWNTOWN DOUGS
	Net Income for the Year
	($000)
	Actual Results
Actual Results	Delicatessen						Restaurant				Total				Budget				Over- or (Under-) Budgeta
Sales revenue		$	1,200				$	2,000			$	3,200			$	3,500				$	(300	)
Costs
Purchasesb			780					800				1,580				1,600				$	(20	)
Hourly wagesb			60					700				760				926					(166	)
Franchise feeb			36					60				96				106					(10	)
Advertising			100					200				300				300
Utilitiesb			76					100				176				196					(20	)
Depreciation			50					76				126				126
Lease cost			30					50				80				80
Salaries			30					50				80				80
Total costs		$	1,162				$	2,036			$	3,198			$	3,414				$	(216	)
Operating profit		$	38				$	(36	)		$	2			$	86				$	(84	)

^a There is no sales price variance.

^b Variable costs; all other costs are fixed.

Required:

Prepare a profit variance analysis for the delicatessen segment. (Hint: Use sales revenue as your measure of volume.) (Do not round intermediate calculations. Enter your answers in thousands of dollars. Indicate the effect of each variance by selecting "F" for favorable, or "U" for unfavorable. If there is no effect, do not select either option.)

	Actual	Purchases Variances		Marketing & Administrative Variances		Flexible Budget	Activity Variance		Master Budget
Sales revenue	$1,200								$1,000
Variable costs:
Purchases	780								600
Hourly wages	60								50
Franchise fee	36								30
Utilities	76								70
Total variable costs	$952								$750
Contribution margin	$248								$250
Fixed costs:
Advertising	100								100
Depreciation	50								50
Lease	30								30
Salaries	30								30
Total fixed costs	$210								$210
Operating profit	$38								$40