The actual information pertains to the month of September. As part of the budgeting process, Kriger Fencing Company developed the following static budget for September. Kriger is in the process of preparing the flexible budget and understanding the results.

The primary reason for low operating profits was ________.
A) Lower sales volume than planned
B) A poor management accounting system
C) Increased fixed costs
D) The variable-cost variance

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Actual Results Flexible Budget Static Budget 12,500 Sales volume in units) 10 500,000 S $625,000 300,000 Sales revenues Variable costs Contribution margin Fixed costs 256,000 S 244,000 S 229,000 S S 15,000S 325,000 225,000 S 100,000 Operating profit