Determine and create the pro forma income statement

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Fanning Publications established the following standard price and costs for a hardcover picture book that the company produces

Standard price and variable costs Sales price

Materials cost

Labor cost

Overhead cost

Selling, general, and administrative costs

Planned fixed costs

Manufacturing overhead

Selling, general, and administrative

$ 36.10

8.20

3.80

5.70

6.90

$128,000

50,000

Fanning planned to make and sell 20,000 copies of the book.

Question 1: Prepare the pro forma income statement that would appear in the master budget and also flexible budget income statements, assuming production volumes of 19,000 and 21,000 units. Determine the sales and variable cost volume variances, assuming volume is actually 21,000 units. Indicate whether the variances are favorable (F) or unfavorable (U). (Select "None" if there is no effect (i.e., zero variance).)

Reference no: EM132476316

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