Main Street Muffins sells its muffins to restaurants and coffee houses for an average selling price of $25 per case. The following information relates to the budget for Main Street Muffins for this year:
Budgeted sales in cases..................... 8,000 cases
Packaging cost per case..................................... $ 1
Shipping expense per case ................................ $ 3
Sales commission expense ......... 2% of sales price
Salaries expense (total) ............................... $6,200
Office rent (total) ........................................ $3,500
Depreciation (total) ..................................... $2,500
Insurance expense (total) ............................ $1,900
Office supplies expense (total) ..................... $ 900
During the year, Main Street Muffins actually sold 8,300 cases resulting in total sales revenue of $215,400. Actual expenses (in total) from this year are as follows:
Packaging cost (total) ................................... $ 8,700
Shipping expense (total) .............................. $25,900
Sales commission expense (total) ................. $ 4,308
Salaries expense (total) ................................. $ 6,900
Office rent (total) ......................................... $ 3,500
Depreciation (total) ....................................... $ 2,500
Insurance expense (total) .............................. $ 1,800
Office supplies expense (total) ..................... $ 1,200
Requirement
Construct a flexible budget performance report for Main Street Muffins for the year. Be sure to indicate whether each variance is favorable (F) or unfavorable (U).