Produce a reconciliation of the budgeted and actual

Question

Question: The following are the budgeted and actual income statements for Baxter Ltd for the month of July:

                                                                          Budget                                          Actual

Output                                                            1,000 units                                     1,050 units

(Production and sales)

                                                                              £                                                    £               

Sales revenue                                                100,000                                          104,300

Raw materials                                                (40,000) (40,000 meters)                (41,200) (40,500 meters)       

Labour                                                           (20,000) (2,500 hours)                    (21,300) (2,600 hours)

Fixed overheads                                            (20,000)                                           (19,400)      

Operating profit                                              20,000                                              22,400    

Produce a reconciliation of the budgeted and actual operating profit, going into as much detail as possible with the variance analysis.