Prepare Flexible Budget: Full Moon Rising manufactures and sells compact disks for a variety of New Age groups. The company only produces when orders are received and, therefore, has no inventories. The following information is available for the current month:

Required: Prepare a flexible budget for Full Moon Rising.

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Actual Master (based on Budget actual of 415,000 units) (based on budgeted 400,000 units) $1,930,000 $2,000,000 Sales revenue Less: Variable costs: Blank disks Direct labor Variable overhead 600,000 600,000 165,000 140,000 239,000 260,000 Variable marketing and administrative 205,000 200,000 Total variable costs: 1,209,000 1,200,000 Contribution margin 721,000 800,000 Less: Fixed costs: Manufacturing overhead 388,000 400,000 Marketing 120,000 120,000 Administrative 65,000 75,000 Total fixed costs 573,000 595,000 Operating profits $ 148,000 $ 205,000