The accountant for Moon Industries has taken unexpected leave and has not completed the end-of period budget analysis. The following incomplete budget analysis was found on her desk.

Required

(a) Complete the variance analysis report.

(b) Provide a brief report to management of any issues highlighted from your analysis in (a).

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Static budget Variance Flexible budget Variance Actual $ $ 1470 000 Sales (small) Sales (large) 1 000 000 1500 000 1 920 000 Total sales 2500 000 3390 000 Variable costs Materials (small) Labour (small) 400 000 690 000 200 000 330 000 Variable overhead 50 000 74 600 (small) Materials (large) Labour (large) 350 000 510000 200 000 270 000 Variable overhead 30 000 35 400 (large) Contribution margin 1480 000 1 270 000 Fixed costs Manufacturing 120 000 180 000 overhead 90 000 Selling expenses Admin. expenses Net profit 50 000 30 000 25 000 1070 000 1185 000 Additional information: Per unit Large Small Selling price $10 000 $3 000 Variable costs 700 4 000 2 000 Material Labour 400 Variable overhead 500 60