Network Technologies manufactures capacitors for cellular base stations and other communications applications. The company's July 2018 flexible budget shows output levels of 8,500 10,000, and 12,000 units. The static budget was based on expected sales of 10,000 units. The company sold 12,000 units during July. Its flexible budget and actual operating income was as follows: E(Click the icon to view the flexible budget.) B(Click the icon to view the income statement.) Read the requirements Requirement 1. Prepare a flexible budget performance report for July. (Enter a "O" for any zero balances. For any $0 variances, leave the Favorable (F)/Unfavorable (U) input blank.) Network Technologies Flexible Budget Performance Report For the Month Ended July 31, 2018 2 1 3 5 (1)-(3) (3) -(5) Budget Flexible Sales Amounts Actual Budget Flexible Volume Static Budget Per Unit Results Variance Budget Variance Units Sales Revenue Variable Expenses Contribution Margin Fixed Expenses Operating Income Data Table Network Technologies Flexible Budget For the Month Ended July 31, 2018 Budget Amount per Unit Units 8,500 10,000 12,000 25 $ 212,500 $ Sales Revenue 250,000$ 300,000 102,000 120,000 144,000 Variable Expenses 12 Contribution Margin 110,500 130,000 156,000 58,000 58,000 58,000 Fixed Expenses $ 52,500 $ 72,000 $ 98,000 Operating Income Print Done Network Technologies Income Statement For the Month Ended July 31, 2018 Sales Revenue $ 307,000 149,200 Variable Expenses Contribution Margin 157,800 59,500 Fixed Expenses $ 98,300 Operating Income Print Done iRequirements Prepare a flexible budget performance report for July 1. 2. What was the effect on Network's operating income of selling 2,000 units more than the static budget level of sales? 3. What is Network's static budget variance for operating income? 4. Explain why the flexible budget performance report provides more useful information to Network's managers than the simple static budget variance. What insights can Network's managers draw from this performance report? Print Done