FLEXIBLE BUDGET PROBLEMS

Fill in the blanks to complete the flexible budget for Andrews Corporation.

Flexible Budget for Various Levels of Sales / Production Activity

Units:10,000 11,000 12,000

Sales $15 __________ ___________ __________

Variable costs:

Manufacturing $ 5 __________ ___________ __________

Administrative __________ $ 33,000 __________

Contribution Margin __________ ___________ __________

Fixed costs: Manufacturing __________ ___________ $ 50,000

Administrative $ 25,000 ___________ ___________

Operating income/(loss) ======== ======== ========

Use the following data to prepare a flexible budget for possible sales/production levels of 5,000, 6,000, and 7,000 units.

Make sure to show the contribution margin at each activity level.

Sales price $100.00 per unit

Variable costs:

Manufacturing $60.00 per unit

Administrative $12.00 per unit

Selling $ 2.00 per unit

Fixed costs:

Manufacturing $120,000

Administrative $ 35,000