The management of Benson Modems, Inc. (BMI) is uncertain as to the volume of sales that will exist in Year 1. The president of the company asked the chief accountant to prepare flexible budget income statements assuming that sales activity amounts to 5,000 and 7,000 units. The static budget is shown in the following form. Required a. Complete the following worksheet to prepare the appropriate flexible budgets. b. Calculate and show the flexible budget variances for the static budget versus the flexible budget at 7,000 units. c. Indicate whether each variance is favorable (F) or unfavorable (U). (Select "None" if there is no effect (.e., zero variance).) Volume Variance BENSON MODEMS, INC. Flexible Budget Income Statements Cost per Static Flexible Budgets unit Budget Number of units 6,000 5,000 7,000 Sales revenue $ 115 $ 690,000 Variable manufacturing costs: Materials 40 240,000 Labor 25 150,000 Overhead 30,000 Variable selling, general & administrative 42,000 Contribution margin 228,000 Fixed costs: Manufacturing rent 53,000 Depreciation on manufacturing equipment 63,000 Selling, general & administrative expenses 76,600 Depreciation on administrative equipment 15,000 Net income (loss) $ 20,400 $(17,600) $ 58,400 5