1.

Cullumber, Inc. uses a flexible budget for manufacturing overhead based on machine hours. Variable manufacturing overhead costs per machine hour are as follows: Fixed overhead costs per month are: The company believes it will normally operate in a range of 2,300 to 4,300 machine hours per month. Prepare a flexible manufacturing overhead budget for the expected range of activity using increments of 1,000 machine hours. (List variable costs before fixed costs.)