This company makes plushie. The budgeted cost of direct materials is $20 per plushie, the cost of direct labour us $4 per plushie, and variable overhead is allocated at a rate of $7 per plushie. The production manager is pleased with the following data for April:

	Master Budget	Actual Costs	Variance
Direct Materials	$200,000	$182,000	$18,000F
Direct Labour	$40,000	$39,000	$1,000 F
Variable overhead	$70,000	$61,000	$9,000F
Fixed overhead	$30,000	$31,000	$1,000U

Answer:

a) Prepare a flexible budget

b) Should the manager be pleased by the results, explain