Appliance Possible Inc. (AP) is a manufacturer of toaster ovens. To improve control over operations, the president of AP wants to begin using a flexible budgeting system, rather than use only the current master budget. The following data are available for APs expected costs at production levels of 86,000, 97,000, and 108,000 units.

Variable costs
Manufacturing		$7 per unit
Administrative		$4 per unit
Selling		$2 per unit
Fixed costs
Manufacturing		$130,000
Administrative		$79,000

(a)

Prepare a flexible budget for each of the possible production levels: 86,000, 97,000, and 108,000 units. (List variable costs before fixed costs.)

APPLIANCE POSSIBLE INC. Flexible Production Cost Budget
Production LevelsAdministrativeFixed CostsVariable CostsActivity LevelSellingTotal Fixed CostsTotal Variable CostsManufacturingTotal Costs
Activity LevelManufacturingSellingTotal Fixed CostsVariable CostsFixed CostsAdministrativeTotal CostsProduction LevelsTotal Variable Costs
Variable CostsActivity LevelProduction LevelsFixed CostsManufacturingTotal Variable CostsTotal CostsSellingAdministrativeTotal Fixed Costs
Production LevelsSellingManufacturingAdministrativeFixed CostsActivity LevelTotal CostsVariable CostsTotal Fixed CostsTotal Variable Costs		$		$		$
Total Variable CostsManufacturingSellingActivity LevelTotal Fixed CostsProduction LevelsAdministrativeFixed CostsVariable CostsTotal Costs
Fixed CostsManufacturingActivity LevelTotal Variable CostsAdministrativeVariable CostsSellingTotal CostsTotal Fixed CostsProduction Levels
Total Variable CostsAdministrativeProduction LevelsSellingTotal CostsVariable CostsActivity LevelFixed CostsManufacturingTotal Fixed Costs
Fixed CostsTotal Fixed CostsVariable CostsTotal CostsActivity LevelTotal Variable CostsManufacturingProduction LevelsSellingAdministrative
Production LevelsAdministrativeVariable CostsManufacturingFixed CostsActivity LevelSellingTotal CostsTotal Fixed CostsTotal Variable Costs
SellingVariable CostsTotal Fixed CostsManufacturingProduction LevelsTotal CostsTotal Variable CostsAdministrativeFixed CostsActivity Level
Production LevelsFixed CostsVariable CostsTotal CostsTotal Fixed CostsAdministrativeSellingActivity LevelManufacturingTotal Variable Costs
Total Variable CostsVariable CostsSellingProduction LevelsManufacturingTotal Fixed CostsFixed CostsTotal CostsActivity LevelAdministrative		$		$		$