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Budgeted amounts for the year: Materials 3 leather strips @ $6.70 Labor 1.5 hr @ $19.00 Variable overhead (VOH) 2.5 hr @ $0.80 Fixed overhead

Budgeted amounts for the year:

Materials 3 leather strips @ $6.70
Labor 1.5 hr @ $19.00
Variable overhead (VOH) 2.5 hr @ $0.80
Fixed overhead (FOH) $6,100
Required:
1. Prepare a flexible budget for 3,400, 3,900, and 4,400 units.
2. CONCEPTUAL CONNECTION (a) Calculate the unit cost at 3,400, 3,900, and 4,400 units. (b) What happens to unit cost as the number of units produced increases?

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