Vroom-Vroom manufactures ride-on cars for toddlers and young children. They have a fiscal year of August through July. When they were preparing their budget, they couldn’t decide if a static or flexible budget would be best for their company – so they did both. It is now February, and their accounting department is catching up on analyzing variances for both December and January. Vroom-Vroom would like to use this opportunity to determine whether they would be better off with a static or flexible budget going forward. They want to choose which budget and related variance analysis provides them the best information for decision-making. Here is the data that Vroom-Vroom used for their budgets:Vroom-Vroom estimated sales/production will be between 100,000 and 300,000 cars per month. Their static budget is based on 200,000 cars sold per month. Assume that all units produced in a month are also sold in that month. Vroom-Vroom’s unit of production/sale is a car (unit/each).Here are the Actual Results in December and January:Question 1: Prepare a static budget in Excel for Vroom-Vroom based on 200,000 units produced. (36 points)a) Show the static budget for December in Contribution Margin Income Statement format. b) Compare December’s static budget to December’s actual results. Specify which line items are favorable or unfavorable and how much. c) For Ingredient Costs and Packaging Costs, break out the Price and Volume Variances for December. Provide potential explanations for each one. d) Show the static budget for January in Contribution Margin Income Statement format. e) Compare January’s static budget to January’s actual results. Specify which line items are favorable or unfavorable and how much. f) For Ingredient Costs and Packaging Costs, break out the Price and Volume Variances for January. Provide potential explanations for each one.