The Greatest Friends is a dog rescue group that specializes in finding homes for the Great Dane breed. The company produces the following cost report for June.

The Greatest Friends
Cost Variance Report
For the Month Ended June 30
	Budget	Actual	Variance
Number of dogs in care	10	4	6 U
Variable costs
Grooming	$2,000	$1,300	$700 F
Dog food	10,000	6,500	3,500 F
Cleaning supplies	500	400	100 F
Total variable costs	12,500	8,200	4,300 F
Fixed costs
Salaries	1,500	1,600	100 U
Property taxes	400	400	__-__
Total fixed costs	1,900	2,000	100 U
Total costs	$14,400	$10,200	$4,200 F

Valerie Pringle, the manager of the rescue group comments on the report: Im certainly proud of this cost report, it shows that Im not only doing a great job caring for the animals in our care, Im also keeping costs under control.

Required:

1. Comment on the major flaw in the report above.
2. Prepare a revised report using a flexible budget.
3. Comment on Pringles assertion that she is doing a great job keeping costs under control.