Review the following schedule:

	(A)		(B)		(C)		(D)		(E)
	Master budget	Volume variances	Flexible budget	Flexible budget variances	Actual results
			(C - A)				(E - C)
Sales - units	20,000		2,000		22,000		0		22,000
Sales - revenue	$600,000		$60,000		$660,000		$(22,000)		$638,000
Variable expenses
COGS	(360,000)		(36,000)		(396,000)		(18,700)		(414,700)
Commissions	(6,000)		(600)		(6,600)		(6,160)		(12,760)
	(366,000)		(36,600)		(402,600)		(24,860)		(427,460)
Contrib. margin	234,000		23,400		257,400		(46,860)		210,540
Fixed expenses
Salaries	(50,000)		(10,000)		(60,000)		(5,000)		(65,000)
Other operating	(40,000)		0		(40,000)		(10,000)		(50,000)
Depreciation	(10,000)		0		(10,000)		0		(10,000)
	(100,000)		(10,000)		(110,000)		(15,000)		(125,000)
Inc. from operations	134,000		13,400		147,400		(61,680)		85,540
Interest expense	(20,000)		0		(20,000)		(5,000)		(25,000)
Inc. before taxes	114,000		13,400		127,400		(66,860)		60,540
Income taxes	(22,800)		(2,680)		(25,480)		10,345		(15,135)
Net income	$91,200		$10,720		$101,920		$(56,515)		$45,405

Required: Provide plausible explanations for the volume and flexible budget variances.