Foy Company has a welding activity and wants to develop a flexible budget formula for the activity. The following resources are used by the activity:

-Four welding units, with a lease cost of $15,000 per year per unit

-Six welding employees each paid a salary of $46,000 per year (A total of 9,000 welding hours are supplied by the six workers.)

-Welding supplies: $300 per job

-Welding hours: 3 hours used per job

During the year, the activity operated at 80 percent of capacity and incurred the following actual activity and resource costs.

-Lease cost: $60,000

-Salaries: $289,800

-Parts and supplies: $715,400