Treanor Enterprises manufactures tires for the Formula I motor racing circuit. For August $2020,$ it budgeted to manufacture and sell $3,600$ tires at a variable cost of $$75$ per tire and total fixed costs of $$54,500.$ The budgeted selling price was $$109$ per tire. Actual results in August $2020$ were $3,500$ tires manufactured and sold at a selling price of $$110$ per tire. The actual total variable costs were $$290,500,$ and the actual total fixed costs were $$51,000.$

Read the requirements.

Requirement $1.$ Prepare a performance report with a flexible budget and a static budget.

Begin with the actual results, then complete the flexible budget columns and the static budget columns. Label each variance as favorable or unfavorable. $($For variances with a $$0$ balance, make sure to enter $"0"$ in the appropriate field. If the variance is zero, do not select a label.$)$

Actual

Results

Units sold

Revenues

Variable costs

Contribution margin

Fixed costs

Operating income

Requirements

Prepare a performance report with a flexible budget and a static budget.

Comment on the results in requirement $1.$