16-27

Osage, Inc., manufactures and sells lamps. The company produces only when it receives orders and, therefore, has no inventories. The following information is available for the current month:

	Actual (based on actual orders for 450,000 units)						Master Budget (based on budgeted orders for 480,000 units)
Sales revenue		$	4,491,000					$	4,320,000
Less
Variable costs
Materials			1,440,000						1,440,000
Direct labor			249,000						312,000
Variable overhead			675,000						624,000
Variable marketing and administrative			443,000						456,000
Total variable costs		$	2,807,000					$	2,832,000
Contribution margin		$	1,684,000					$	1,488,000
Less
Fixed costs
Manufacturing overhead			903,300						875,000
Marketing			281,000						281,000
Administrative			200,000						176,000
Total fixed costs		$	1,384,300					$	1,332,000
Operating profits		$	299,700					$	156,000

Required:

Prepare a flexible budget for Osage, Inc.