K&B is a small management consulting firm. Last month, the firm billed fewer hours than expected, and, as expected, profits were lower than anticipated.

	Reported Income Statement				Master Budget
Billable hoursa			7,230			9,150
Revenue		$	673,000		$	813,000
Professional salaries (all variable)			341,500			401,500
Other variable costs (e.g., supplies, computer services)			98,300			120,300
Fixed costs			205,600			200,600
Profit		$	27,600		$	90,600

^aThese are hours billed to clients. They are fewer than the number of hours worked because there is nonbillable time (e.g., slack periods, time in training sessions) and because some time worked for clients is not charged to them.

Required:

Prepare a flexible budget for K&B. Use billable hours as the measure of output (that is, units produced). (Do not round intermediate calculations. Enter your answers rounded to the nearest whole dollar.)

Flexible Budget (based on actual of 7,230 hours) Revenue Costs: Professional salaries Other variable costs Fixed costs Total costs Profit $ 0 $ 0