P7-7 Preparing a performance report Use the flexible budget prepared in P7-6 for the 31,000-unit level and the actual operating results listed below for the 31,000-unit level. Required: 1. Prepare a performance report. 2. List the major reasons why the actual operating income at 31,000 units differs from the master budget operating income at 30,000 units in Figure 7-12. 3. Given the level at which the company operated, how was its cost control? Item $4,800,000 Sales. ......... Direct materials: Critical . . . . . . . . . . . . .... 633,000 Thinking Lumber ...... ............ Problem Paint . . ...... .. ...........24.... 127,500 Direct labor: Cutting . ....... 115,200 Assembly . ........ 75,300 . . .. . Painting ........ . . . . . .... 47,100 .. . . . . . Variable factory overhead.......... 137.656 . . . . . . . . . . . . . Variable selling and administrative expense ......... .. . .. ." 777,400 Fixed factory overhead ......... 154 435 12...............4 Fixed selling and administrative expense 765 800 . . . . . . . . ... P7-8 Preparing a performance report Use the flexible budget prepared in P7-6 for the 29,000-unit level of activity and the actual operating