Matolka Marine Inc. has just finished its operations for August, which was a particularly busy month. They processed 24% more product than had been originally planned for the month. A report prepared by Management comparing actual costs to budgeted costs appears below. 3 Budget 500 Variance 300 F Matoika Marine Cost Control Report For the Month Ended August 31 Actual Units Produced 800 Variable costs: Marine supplies $ 8,500 Emission tests 8,500 Other Variable 1,900 Administrative supplies Total variable cost 19,450 Fixed costs: Staff salaries 18,000 Equipment depreciation 3,600 Rent 1,800 Utilities 650 Total fixed cost 24, 050 Total cost $43,500 $ 5,250 6,800 1,150 325 13,525 $ 3,250 W 1,700 U 750 U 225 0 5,925 U 550 700 U 18,000 2,900 1,800 540 23,240 $36,765 110 U 819 $ 6,735 U The managing director was very unhappy with this report, claiming that his costs were higher than expected. He also pointed out that the additional costs had been fully covered by payments from suppliers. The accountant who prepared the report pointed out that actual costs were a lot higher than promised in the budget. Required: 1. Prepare a new performance report for August using the flexible budget approach. (Note: Even though some of these costs might be classified as direct costs rather than overhead, the flexible budget approach can still be used to prepare a flexible budget performance report.). (Indicate the effect of each variance by selectina "Fy for favourable. "U" for unfavourable, and "None" for no effect li.e.. Matoka Marine Flexible Budget Performance Report For The Month Ended August 31 Actual Spending or Budget Variance Flexible Budget Static Budget Cost Fomula Activity-Level (units) (Per und 800 800 600 Venable costs Medical supohes Emmission tests Other vanale Expenses Administrative supplies Total vanable cost Fored costs Stali salanes Equipment depreciation Rent Ultes ed cost Total cos