This is Cost Accounting. Capital Budgetting

Problems: Answer any two of the three problems. Show all work. 21) McElroy Company has prepared the following master budget for 2019. Although McElroy has the capacity to manufacture 50,000 units, management expected the likely demand for its product to be 40,000 units in 2019; as such, it prepared the master budget to manufacture and sell 40,000 units. In early January 2020, the company was pleasantly surprised to find out that it manufactured and sold 45,000 units in 2019 Master (Static) Budget For Year Ending Decemer 3, 2019 Sales (40,000 units) Cost of Goods Sold: Direct materials Indirect materials (variable) Indirect labor (variable) Utilities (80% fixed) Maintenance (40% variable) 0,0001,810 Commissions (5% of sales) Advertising (fixed) Wages (variable) Total operating expenses Operating Income S 550,000 Required: 1. Prepare the flexible budget for the actual operating level achieved in 2019 2. Find and identify the Master Budget variance, the sales volume variance and the flexible budget variance