Flexible Budget Exercise Bookbinder Company is in the process of preparing their budget for next month for expenses. Their budgeted costs are: Variable Costs Direct Material $5.30/ unit Direct Labor $2.50 /unit Variable Overhead $1.20 / unit Fixed Costs per month Supervisory salaries $14,000 Factory depreciation $8,500 Other factory costs $41,100 1. The controller is analyzing different possible expenditure levels based on the production level. He wants an analysis done at 8000 & 10,000 units per month. Prepare a budget plan at these two levels. 2. Assume the controller then decides that most likely volume level for next month’s budget should be the 10,000 units. Once the month is over, the actual data came in as follows, with 9950 units produced: Variable Costs Direct material $54,725 Direct Labor $25,870 Variable Overhead $10,945 Fixed Costs Supervisory Salaries $15,000 Factory Depreciation $8,500 Other factory costs $42,000 a. Prepare a variance analysis of the static budget plan at 10000 units versus the actual data. Label each variance as favorable or unfavorable. b. Prepare a variance analysis based on a flexible budget plan, after the fact, using 9950 units. c. Based on an analysis of actual versus flexible versus static budget (based on a & b above) , identify all variances as volume variances or flexible budget variances.