Exercise 21-5 (Algo) Preparing flexible budget performance report LO P1

Nina Company prepared the following fixed budget for July using 7,580 units for budgeted sales. Actual sales were 7,280 units and actual costs are shown below.

Fixed Budget
For Month Ended July 31	Variable Amount per Unit	Total Fixed Cost	Fixed Budget (7,580 units)	Actual Results (7,280 units)
Sales	$ 100		$ 758,000	$ 744,880
Variable costs
Direct materials	35		265,300	269,680
Direct labor	15		113,700	110,800
Indirect materials	4		30,320	28,520
Sales commissions	11		83,380	79,240
Total variable costs	65		492,700	488,240
Contribution margin	$ 35		$ 265,300	$ 256,640
Fixed costs
DepreciationMachinery		$ 68,960	68,960	68,960
Supervisor salary		40,940	40,940	42,080
Insurance		10,120	10,120	10,120
DepreciationOffice equipment		7,480	7,480	7,480
Administrative salaries		33,900	33,900	30,120
Total fixed costs		$ 161,400	161,400	158,760
Income			$ 103,900	$ 97,880

Prepare a flexible budget performance report for July at activity level of 7,280 units. Show variances between budgeted and actual amounts. (Indicate the effect of each variance by selecting favorable, unfavorable, or no variance.)