Activity-Based Flexible Budgeting Foy Company has a welding activity and wants to develop a flexible budget formula for the activity. The following resources are used by the activity: . Four welding units, with a lease cost of $15,000 per year per unit Six welding employees each paid a salary of $53,000 per year (A total of 12,000 welding hours are supplied by the six workers.) Welding supplies: $400 per job Welding hours: 4 hours used per job During the year, the activity operated at 95 percent of capacity and incurred the following actual activity and resource costs. . Lease cost: $60,000 Salaries: $333,900 Parts and supplies: $1,134,700 Required: 1. Prepare a flexible budget formula for the welding activity using welding hours as the driver. Welding cost 2. Prepare a performance report for the welding activity. In the last column of Foy Company Activity-Based Performance Report, if variance amount is unfavorable select "U" , select "F", if it is Favorable and select "NA" if there is no variance. Foy Company Activity-Based Performance Report Budgeted Cost (95% Budget level) Variance Activity Actual Cost Variance Welding: Fixed cost Variable cost 3. What if welders were hired through outsourcing and paid $30 per hour (the welding equipment is provided by Foy)? Repeat Requirement 1 for the outsourcing case. Welding cost