10.1 Shirt Company prepared the following budget for 201X based on the production and sale of 6.000 shirts. Sales Cost of goods sold Depreciation (straight-line) Direct labor Direct materials Machinery repairs (S900 fixed) Plant (factory) managers salary Factory Insurance Utilities ($3,000 fixed) Gross proft Operating Ex $270,000 $3,400 15,000 62,400 1,800 40,000 2,400 6.000 131,000 $139,000 perating Expenses (SG&A Administrative salaries Advertising expense Packaging expense Sales commissions expense Shipping expense Travel & entertainment expense Operating Income $60,000 20,000 2,400 6,000 12,000 5000 105.400 $33,600 A. Classify each cost as either variable or fixed. B. Calculate the cost per unit for all variable costs. C. Prepare flexible budgets using the contribution margin format (Sales-VC-CM-FC-01). Assume sales of four, six, and eight thousand units. Shirt Co sold lour