The Guatemala Refugee Association sells one kind of coffee to support its activities. It is in the process of preparing

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The Guatemala Refugee Association sells one kind of coffee tosupport its activities. It is in the process of preparing aflexible budget to determine why actual excess of revenue overexpenses is below budgeted.
Required: Prepare aflexible budget and provide one plausible explanation for eachvolume and flexible budget variance.
Master budget
Flexible budget
Actual results
Sales – units
20,000
18,500
Variable revenue
$1,050,000
$972,000
Variable costs
(500,000)
(477,000)
Contribution margin
550,000
495,000
Fixed costs
(380,000)
(375,000)
(378,000)
Excess of revenue over expenses
$ 170,000
$117,000