During the year of 20XX, a firm plans to produce and sell 15,000 units at $35 per unit. Budgeted variable costs are 40% of sales revenue and fixed costs are $241,500. Actual results are now available and the firm produced and sold 15,500 units at $35.50 per unit. Actual variable costs were $216,000 and actual fixed costs were $244,800.
Prepare a complete Income Statement Performance Report and compute the Flexible budget variance and sales volume variance. Be sure to note if a variance is favorable (F) or unfavorable (U).