Flexible Budget for Assembly Department

Blue Chair Inc. is one of the largest manufacturers of office furniture in the United States. In Michigan, it produces filing cabinets in two departments: Fabrication and Assembly. Assume the following information for the Assembly Department:

Line Item Description	Amount
Direct labor per filing cabinet	20 minutes
Supervisor salaries	$114,000 per month
Depreciation	$23,000 per month
Direct labor rate	$15 per hour

Prepare a flexible budget for 8,000, 10,000, and 12,000 filing cabinets for the month of August, similar to Exhibit 5, assuming that inventories are not significant. Enter all amounts as positive numbers.

Line Item Description	Amount	Amount	Amount
Units of production	8000	10000	12000
Variable cost:
Direct labor
Fixed cost:
Supervisor salaries
Depreciation
Total fixed cost
Total department costs