1. Wizard Northwestern, Inc. operates a king crab fishing boat in the Bering Sea. Management has identified two cost driversthe number of days the boat is at sea and number of crab pots set or placed to catch crabthat it uses in its budgeting and performance reports. Data concerning the company's cost formulas appear below: Fixed costs $ 335,000 125,000 Cost per pot set $ 135 Costs per day $ 1,200 1,000 2,000 25,000 2,500 Cost per crab $ 3 Vessel operating costs Captain's cost Crew costs Licenses Insurance 10 5 2,500,000 100,000 Management expects that the boat will operates approximately 84 days each year. It takes a full day of sailing for the boat to reach the crab grounds. Once there, it takes a day to set the 200 crab pots on board. The pots are allowed to soak for two days. The pots are retrieved along with the crabs inside on the third day. The next day, the pots are set again, and the cycle repeats. After three cycles, the boat sales for a full day to offload its catch at the processing facility. The boat then spends a full day sailing back to the crab fishing grounds and repeats the process. Management expects each pot will contain 45 king crab weighing approximately 8 pounds each when retrieved. In the recent past, the processor has been paying $10 per pound for king crab. Required: a. Prepare the company's flexible budget for the next crab fishing season. b. For the season, Wizard Northwestern caught 175,000 crab with an average weight of 7.5 pounds, and sold them at an average price of $10.75 per pound. The boat was active for a total of 90 days, and it set the 220 crab pots it carried 20 times during. Actual vessel operating costs were $1,155,000, actual captain's costs were $700,000, actual crew costs were $1,100,000, actual licensing costs were $4,750,000, and actual insurance costs were $347,500. Prepare Wizard Northwestern's flexible budget for the season. c. Prepare Wizard Northwesterns flexible budget performance report for the season, including both the spending and activity variances 1. Wizard Northwestern, Inc. operates a king crab fishing boat in the Bering Sea. Management has identified two cost driversthe number of days the boat is at sea and number of crab pots set or placed to catch crabthat it uses in its budgeting and performance reports. Data concerning the company's cost formulas appear below: Fixed costs $ 335,000 125,000 Cost per pot set $ 135 Costs per day $ 1,200 1,000 2,000 25,000 2,500 Cost per crab $ 3 Vessel operating costs Captain's cost Crew costs Licenses Insurance 10 5 2,500,000 100,000 Management expects that the boat will operates approximately 84 days each year. It takes a full day of sailing for the boat to reach the crab grounds. Once there, it takes a day to set the 200 crab pots on board. The pots are allowed to soak for two days. The pots are retrieved along with the crabs inside on the third day. The next day, the pots are set again, and the cycle repeats. After three cycles, the boat sales for a full day to offload its catch at the processing facility. The boat then spends a full day sailing back to the crab fishing grounds and repeats the process. Management expects each pot will contain 45 king crab weighing approximately 8 pounds each when retrieved. In the recent past, the processor has been paying $10 per pound for king crab. Required: a. Prepare the company's flexible budget for the next crab fishing season. b. For the season, Wizard Northwestern caught 175,000 crab with an average weight of 7.5 pounds, and sold them at an average price of $10.75 per pound. The boat was active for a total of 90 days, and it set the 220 crab pots it carried 20 times during. Actual vessel operating costs were $1,155,000, actual captain's costs were $700,000, actual crew costs were $1,100,000, actual licensing costs were $4,750,000, and actual insurance costs were $347,500. Prepare Wizard Northwestern's flexible budget for the season. c. Prepare Wizard Northwesterns flexible budget performance report for the season, including both the spending and activity variances