The following information for July and August were extractedfrom the costing records of Venus CC:

                                                   July                                  August

Production and sales(units)        12 000                               10 000

                                                       R                                      R

Costs:

Directmaterial                            270 000                              225000

Directlabour                               360000                              300 000

Factoryoverhead                        360000                             331 500

Marketingexpenses                    93 000                             87 000

Administrativeexpenses            153000                              144 000

At the beginning of September it was estimated that productionfor that month would be either 13 000 or 14 000 units.

REQUIRED

1. Draw up the flexible budget for September based on

   13 000 and 14 000 units.   

2. At the end of September the cost records revealed thatthe

   Following costs/expenses were incurred in producingand selling

   13 500 units:

                                                                                     R

           Directmaterial                                              302 400

           Directlabour                                                 400 500

           Factoryoverhead                                                      425 250

           Marketingexpenses                                      108 450

           Administrativeexpenses                               180 900

Draw up a variance analysis report for September and indicatenext to each variance whether it is favourable orunfavourable.