The Creative Balloon Company produces party balloons that are sold in multi-pack cases. To follow is the company's performance report in contribution margin format for December:

Requirements 4 & 5:

Compute the master budget variances. Be sure to indicate each variance as favorable (F) or unfavorable (U.) Management would like to determine the portion of the master budget variance that is (a) due to volume being different than originally anticipated, and (b) due to some other unexpected cause. Prepare a flexible budget performance report to address these questions, using the actual sales volume of 59,500 units and the budgeted sales volume of 56,000 units. Use the original budget assumptions for sales price, variable cost perunit, and fixed costs, assuming the relevant range stretches from 51,000 to 64,500 units.

Begin by completing the actual and master budget columns of the performance report and then the master budget variances. Then compute the flexible budget column and the remaining variance columns. (Round all amounts to the nearest whole dollar. For accounts with a 0 balance, make sure to enter "0" in the appropriate column. Label each variance as favorable (F) or unfavorable (U).)

The Creative Balloon Company Actual vs. Budget Performance Report For the Month Ended December 31 Master Master Budget Actual Budget Variance Sales volume (number of cases sold) 56,000 59,500 $ 212,400 $ 190,400 Sales revenue 128,100 117,600 Less: Variable expenses S 84,300 S Contribution margin 72,800 73,600 72,000 Less: Fixed expenses $ 10,700 $ 800 Operating income Requirement 1. What is the budgeted sales price per unit? The budgeted sales price per unit Requirement 2. What is the budgeted variable expense per unit? The budgeted variable expense per unit is $ Requirement 3. What is the budgeted fixed cost for the period? The budgeted fixed cost for the period is S Flexible Master Budget Flexible Volume Master Budget Actual Variance Budget Variance Budget Variance Sales volume Sales revenue Less: Variable expenses Contribution margin Less: Fixed expenses Operating income Requirement 6a. Using the flexible budget performance report you prepared for Requirement 5, answer the following question: How much of the master budget variance (calculated in Requirement 4) for operating income is due volume being higher than expected? The amount of the master budget variance for operating income due to volume being higher than expected is $ Requirement 6b. Using the flexible budget performance report you prepared for Requirement 5, answer the following question: How much expenses is due the master budget variance for variable some cause other than volume? The amount of the master budget variance for variable expenses due to some cause other than volume is$ Requirement 6c. Using the flexible budget performance report you prepared for Requirement 5, answer the following question: What could account for the flexible budget variance for sales revenue? could account for the flexible budget variance for sales revenue. Requirement 6d. Using the flexible budget performance report you prepared for Requirement amount? (Enter a "0" for any zero amounts.) answer the following question: What is the volume variance for fixed expenses? Why is it this because the flexible budget uses the The volume variance for fixed expenses is $ amount for fixed expenses because fixed expenses are