The management accountant for JK Scaffolding has the following not complete the budget analysis.

Questions:

1.Complete the variance analysis report and show your formula for each and computation.

2.Provide a report to management of any issues present from the analysis.

	Forecast budget	Variance	Flexible budget	Variance	Actual
	$	$	$	$	$
Sales (Sand)	1,500,000				1,920,000
Sales (bricks)	1,000,000				1,470,000
Total sales	2,500,000				3,390,000
Variable costs
Materials (Sand)	350,000				510,000
Labour (Sand)	200,000				270,000
Variable overhead (Sand)	30,000				35,400
Materials (Bricks)	400,000				690,000
Labor (Bricks)	200,000				330,000
Variable OH (Bricks)	50,000				74,600
Contribution margin	1,270,000				1,480,000
Fixed manufacturing costs
Manufacturing overhead	120,000				180,000
Selling expenses	50,000				90,000
Admin expenses	30,000				25,000
Net profit	1,070,000				1,185,000

Additional information:

Per Unit	Sand	Bricks
Selling price	$3,000	$10,000
Variable costs
Material	$700	$4,000
Labour	$400	$2,000
Variable overhead	$60	$500