The following data are for the month of January for the Submissive Company, a maker of boots:

Master-budget data:	Actual results:
Sales of 30,000 pairs at $70 per pair	Sales of 32,000 pairs at $68 per pair
variable costs of $45 per pair;	variable costs of $48 per pair;
$250,000 total fixed costs	$238,000 total fixed costs

(Show Workings)

a) Calculate the operating income under flexible budget.

b) Assume that ACTUAL operating income is $405,000, and master budgeted operating income is $503,000. Calculate the January Sales activity variance at operating income (indicate F or U)

Answer: