Based on the information in the attachment below:

1. Prepare a flexible budget performance report for Production that compares actual and allowed costs.

2. Prepare a flexible budget performance report for selling and distribution that compares actual and allowed costs.

3. Determine the revenue variance.

4. Determine the sales price variance.

5. Determine the sales volume variance.

6. Explain to management the areas that should be investigated. You should also include why the actual income is less than budgeted Explain why you picked these areas to look at.

This part relates to Module 23. I have flexible budget support material in the Module 23 folder in course resources. Crafts Inc., is a manufacturer of furniture. The company has 2 responsibility centers. Production and Selling and Distribution Production and administration are cost centers while Seling and Distribution is a profit center. Presented below are the budgeted and actual contribution income statement for October along with applicable unit information Budgeted unit information Units Sale price per 800 $244 $48 Direct material per unit Direct labor per unit Variable manufactung overhead per $18 Variable seling and distribution per $45 Actual Units 825 Craft nc Budgeted Contribution Income Statement For Month of October $ 195,200 Sales Less Variable costs Variable cost of goods solt Direct materials Direct labor Manufactuig overhead $ 38,400 14,400 12,800 $ 65,600 36,000 Seling and distribution Contribution Martin (101,600) 93 600 Less Fixed Costs: Manufacturing overhead Seling and Distribution 40,000 30,000 (70,000) Net Income 23,600 Craft Inc. Actual Contribution Income Statement For Month of October $ 230,000 Sales Less Variable costs Variable cost of goods sold Direct materials Direct labor Manufacturing overhead $ 40,000 15,000 13,500 $ 68,500 39,000 Seling and distribution Contribution Margin (107,500) 122,500 Less Fixed Costs Manufactuig overhead Seling and Distibution 39,000 31,000 70,000) Net Income(Loss) 52,500 This part relates to Module 23. I have flexible budget support material in the Module 23 folder in course resources. Crafts Inc., is a manufacturer of furniture. The company has 2 responsibility centers. Production and Selling and Distribution Production and administration are cost centers while Seling and Distribution is a profit center. Presented below are the budgeted and actual contribution income statement for October along with applicable unit information Budgeted unit information Units Sale price per 800 $244 $48 Direct material per unit Direct labor per unit Variable manufactung overhead per $18 Variable seling and distribution per $45 Actual Units 825 Craft nc Budgeted Contribution Income Statement For Month of October $ 195,200 Sales Less Variable costs Variable cost of goods solt Direct materials Direct labor Manufactuig overhead $ 38,400 14,400 12,800 $ 65,600 36,000 Seling and distribution Contribution Martin (101,600) 93 600 Less Fixed Costs: Manufacturing overhead Seling and Distribution 40,000 30,000 (70,000) Net Income 23,600 Craft Inc. Actual Contribution Income Statement For Month of October $ 230,000 Sales Less Variable costs Variable cost of goods sold Direct materials Direct labor Manufacturing overhead $ 40,000 15,000 13,500 $ 68,500 39,000 Seling and distribution Contribution Margin (107,500) 122,500 Less Fixed Costs Manufactuig overhead Seling and Distibution 39,000 31,000 70,000) Net Income(Loss) 52,500