Nambe Clay, Inc., produces clay products for art in elementary school art programs. The company's flexible budget income statement for January 2009 shows output levels of \(55,000,60,000\), and 65,000 clay kits. The static budget was based on 55,000 units.

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NAMBE CLAY, INC. Flexible Budget Income Statement Month Ended January 31, 2009 Flexible Budget Sales revenue Variable costs per Output Unit $3.00 Fixed costs Total costs Operating income Output Units (kits) 55,000 $165,000 60,000 $180,000 65,000 $195,000 1.50 82,500 90,000 97,500 70,000 70,000 152,500 160,000 $ 12,500 $ 20,000 70,000 167,500 $ 27,500