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Adams Medical Equipment Company makes a blood pressure measuring kit. Jason McCoy is the production manager. The production departments static budget and actual results for 2019 follow:

	Static Budget					Actual Results
Production in units	23,000 kits					25,100 kits
Direct materials		$	177,100				$	231,170
Direct labor			154,100					161,870
Variable manufacturing overhead			34,500					39,550
Total variable costs			365,700					432,590
Fixed manufacturing overhead			211,000					206,200
Total manufacturing cost		$	576,700				$	638,790

Required

a. Convert the static budget into a flexible budget.

b. Calculate the variances.

Required A

Required B

Convert the static budget into a flexible budget. (Do not round intermediate calculations.)

	Flexible Budget Production in units 25,100 Kits Direct materials Direct labor Variable manufacturing overhead Total variable costs $0 Fixed manufacturing overhead Total manufacturing costs $0

Required B

Calculate the variances. (Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance).)

	Variances Direct materials Direct labor Variable manufacturing overhead Total variable costs Fixed manufacturing overhead Total manufacturing costs

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