Paynesville Corporation manufactures and sells a preservative used in food and drug manufacturing. The company carries no inventories. The master budget calls for the company to manufacture and sell 136,000 liters at a budgeted price of $345 per liter this year. The standard direct cost sheet for one liter of the preservative follows.

Direct materials	(2 pounds @ $22)	$	44
Direct labor	(0.5 hours @ $60)		30

Variable overhead is applied based on direct labor hours. The variable overhead rate is $200 per direct-labor hour. The fixed overhead rate (at the master budget level of activity) is $100 per unit. All non-manufacturing costs are fixed and are budgeted at $3.0 million for the coming year.

At the end of the year, the costs analyst reported that the sales activity variance for the year was $1,026,000 unfavorable.

Required Prepare a flexible budget for Paynesville for the year. (Enter your answers in thousands of dollars.)