Using tables 1 & 3 perform a variance analysis and include a flexible budget. Please say what decisions could've affected the variances and where there is room for improvement

Use table 2 to for the standards cost reference.

Table 2: Standard Cost Card for Previous Fiscal Year Advanced Device Basic Device Direct Materials Ounces of Plastic per Unit 6.00 9.00 Cost per Ounce of Plastic $2.40 $2.40 Ounces of Aluminum per Unit 2.00 0.55 Cost per Ounce of Aluminum $22.00 $22.00 Direct Labor 1.00 2.00 DL Hours per Unit (Components) DL Hours per Unit (Assembly) 3.00 2.00 Total DL Hours per Unit 4.00 4.00 Cost per DL Hour $14.25 $14.25 0.75 Manufacturing Overhead (machine hours is the chosen cost driver) Machine Hours per Unit (Components) 2.50 Machine Hours per Unit (Assembly) 1.75 Total Machine Hours per Unit 4.25 Pre-Determined MOH Rate per Machine Hour $9.75 1.75 2.50 $9.75 Table 1: Budgeted Income Statement for Previous Fiscal Year $53,940,000 Revenues Advanced (Projected Sales = 310,000 units) COGS - Advanced Direct Materials Direct Labor Budgeted MOH Gross Margin - Advanced $18,104,000 $17,670,000 $12,845,625 $5,320,375 = $48,240,000 Revenues Basic (Projected Sales = 360,000 units) COGS - Basic Direct Materials Direct Labor Budgeted MOH Gross Margin - Basic $12,132,000 $20,520,000 $8,775,000 $6,813,000 Total Gross Margin $12,133,375 Selling Costs Commissions (2 percent of revenues) Salaries Fixed Administrative Costs $2,043,600 $460,000 $1,800,000 $550,000 Interest Pre-Tax Income $7,279,775 Table 3: Actual Income Statement for Previous Fiscal Year $60,840,000 Revenues - Advanced (Actual Sales = 360,000 units) COGS - Advanced Direct Materials Direct Laborb Actual MOH Gross Margin - Advanced $21,978,000 $20,880,000 $17,100,000 $882,000 $30,240,000 Revenues Basic (Actual Sales = 210,000 units) COGS - Basic Direct Materials Direct Laborb Actual MOH Gross Margin - Basic $7,654,500 $12,240,900 $6,300,000 $4,044,600 Total Gross Margin $4,926,600 Selling Costs Commissions (2 percent of revenues) Salesperson Salaries Fixed Administrative Costs Interest $1,821,600 $430,000 $1,655,000 $650,000 Pre-Tax Income (Loss) $370,000 a - Direct materials costs consist of 2,160,000 ounces of plastic for the advanced units and 1,890,000 ounces of plastic for the basic; plus 810,000 ounces of aluminum for the advanced units and 157,500 for the basic units. The average price paid was $2.30 per ounce for plastic and $21.00 per ounce for aluminum. b - Actual direct labors totaled 780,000 hours in the Electrical Components department and 1,504,200 hours in the Assembly department for the fiscal year. C - Actual machine hours totaled 1,057,500 hours in the Electrical Components department and 1,282,500 hours in the Assembly department for the fiscal year