Flexible budget. Connor Company’s budgeted prices for direct materials, direct manuf...

Flexible budget. Connor Company’s budgeted prices for direct materials, direct manufacturing labor, and direct marketing (distribution) labor per attaché case are $40, $8, and $12, respectively. The president is pleased with the following performance report:

Actual output was 8,800 attaché cases. Assume all three direct-cost items shown are variable costs. Is the president’s pleasure justified? Prepare a revised performance report that uses a flexible budget and a static budget.