Use the flexible budget prepared in P for the 31,000-unit level and the actual operating results listed below for the 31,000-unit level.

Required:
1. Prepare a performance report.
2. List the major reasons why the actual operating income at 31,000 units differs from the master budget operating income at 30,000 units in Figure.
3. Given the level at which the company operated, how was its cost control?
Item
Sales..................................................................... $4,800,000
Direct materials:
Lumber................................................................. 633,000
Paint..................................................................... 127,500
Direct labor:
Cutting ................................................................ 115,200
Assembly.............................................................. 75,300
Painting................................................................ 47,100
Variable factory overhead.................................... 137,655
Variable selling and administrative expense........ 777,400
Fixed factory overhead........................................ 154,435
Fixed selling and administrative expense............ 765,800

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Item $per unit 28,000 units 30,000 units 32,000 units Sales Less variable expenses: Direct materials: Lumber Paint Direct labor Cutting Assembly Painting Variable factory ovarhead Variable seling and admin Total variable expense Contribution margin Less fixed expenses: Fixed factory overhead Fixed selling and admin Total fixed expense Operating income 150.00 $4,200,000 4500000 $4800,000 $20.00 560,000 $600,000 $640,000 128,000 4.00 112,000 120,000 3.75 2.40 1.50 120,000 76,800 48,000 133,760 825,280 $61.62$1725360 $1848600 $1971840 $88.38 %24746402651400 2828160 105,000 67,200 42,000 117,040 25.79726 4360 112,500 72,000 45,000 125,400 773,70040 $151,760 773,825 $151,760 773,825 $151,760 1,549,055 $1,725,815 $1,902,575