Crane Corp's master (static) budget for the year is: Crane Corp's actual results for the year were: $ 1,860,000 $1,960,000 $ 168,000 450,000 180,000 90,000 $174,563 456,925 182,770 91,875 906,133 888,000 972,000 $ $1,053,868 Sales (60,000 units) COGS: DM DL VOH applied at 40% of DLS FOH applied at $1.50 per unit Gross Profit Selling Exp: Sales commissions (variable) Rent (fixed) Insurance (fixed) General Exp: Salaries (fixed) Rent (fixed) Depreciation (fixed) Operating Income Sales (61,250 units) COGS: DM DL VOH FOH applied at $1.50 per unit Gross Profit Selling Exp: Sales commissions (variable) $170,450 Rent (fixed) 38,000 Insurance (fixed) 29,875 General Exp: Salaries (fixed) $ 91,250 Rent (fixed) 74,800 Depreciation (fixed) 50,000 Operating Income $ 167,400 38,000 29,000 $ 234,400 $ 238,325 $ 90,000 74,000 50,000 214,000 216,050 $ 448,400 523,600 454,375 $ 599,493 Required: 1) Prepare a flex budget at the actual level of output and then determine your variances between the flex budget and actual results. (Hint: set up the income statement on a "Contribution Margin" basis where you take Sales - all vC (whether a production cost or a period exp) = CM-all FC (again, whether a production cost or a period exp) = Op Income BEFORE you prepare your flex budget and calc your variances.) 2) Indicate which variances would need to be investigated if the company policy was to investigate any variance that is greather than $1,500 or 3% of the flex budget