Exercise 21-3 Preparing flexible budgets LO P1

Tempo Company's fixed budget (based on sales of 12,000 units) for the first quarter reveals the following.

Fixed BudgetSales (12,000 units $210 per unit)$2,520,000Cost of goods soldDirect materials$288,000Direct labor528,000Production supplies312,000Plant manager salary88,0001,216,000Gross profit1,304,000Selling expensesSales commissions96,000Packaging180,000Advertising100,000376,000Administrative expensesAdministrative salaries138,000Depreciationoffice equip.108,000Insurance78,000Office rent88,000412,000Income from operations$516,000