Required: Part A (4 marks)- Create a Static Budget Report Variance Analysis, indicating whether variances are favorable (F) or unfavorable (U). All variance amounts should be shown as positive numbers.

	Static Budget Amount	Actual Results	Variance Amount	Favorable or Unfavorable
Sales in Units	4,008	5,320	1,312	Unfavorable
Sales	$ 501,000	$ 638,400	137,400	Unfavorable
Less: Variable Costs:
Cost of Goods Sold	217,000	218,000	1,000	Unfavorable
Sales Commissions	75,150	70,224	4,926	Favorable
Total Variable Costs	292,150	288,224	3,926	Favorable
Contribution Margin	208,850	333,120	124,270	Unfavorable
Less: Fixed Costs:
Total Fixed Costs	191,000	192,000	1,000	Unfavorable
Net Operating Income	17,850	144,120	126,270	Unfavorable

	Flexible Budget Amount	Actual Results	Variance Amount	Favorable (F) or Unfavorable (U)
Sales in Units	5,320	5,320	-	N/A
Sales	$ 665,000	638,400	26,600	Unfavorable
Less: Variable Costs:
Cost of Goods Sold	288,034	218,000	70,034	Favorable
Sales Commissions	99,750	70,224	29,526	Favorable
Total Variable Costs	387,784	288,224	99,560	Favorable
Contribution Margin	277,216	333,120	55,904	Unfavorable
Less: Fixed Costs	191,000	192,000	1,000	Unfavorable
Net Operating Income	86,216	141,120	56,904	Unfavorable