The following information was drawn from the accounting records of Smith Company

Static
Budget

Flexible
Budget

Actual
Results

Sales

$ 10,000

$ 12,000

$ 12,700

Cost of Goods Sold

(6,000)

(7,200)

(6,900)

Gross Margin

4,000

4,800

5,800

Variable Cost

(2,000)

(2,400)

(2,600)

Fixed Cost

(1,000)

(1,000)

(1,300)

Net Income

$ 1,000

$ 1,400

$ 1,900

Based on this information the

a. variable operating cost volume variance is a $400 favorable variance.

b. variable operating cost flexible budget variance is a $200 unfavorable variance.

c. variable operating cost volume variance is a $200 favorable variance.

d. variable operating cost flexible budget variance is a $400 favorable variance.