Phoenix Companys 2015 master budget included the following fixed budget report. It is based on an expected production and sales volume of 15,000 units.

PHOENIX COMPANY Fixed Budget Report For Year Ended December 31, 2015

Sales

$

3,000,000

Cost of goods sold

Direct materials

$

975,000

Direct labor

225,000

Machinery repairs (variable cost)

60,000

Depreciationplant equipment (straight-line)

300,000

Utilities ($45,000 is variable)

195,000

Plant management salaries

200,000

1,955,000

Gross profit

1,045,000

Selling expenses

Packaging

75,000

Shipping

105,000

Sales salary (fixed annual amount)

250,000

430,000

General and administrative expenses

Advertising expense

125,000

Salaries

241,000

Entertainment expense

90,000

456,000

Income from operations

$

159,000

PHOENIX COMPANY Statement of Income from Operations For Year Ended December 31, 2015

Sales (18,000 units)				$	3,648,000
Cost of goods sold
Direct materials	$	1,185,000
Direct labor		278,000
Machinery repairs (variable cost)		63,000
Depreciationplant equipment (straight-line)		300,000
Utilities (fixed cost is $147,500)		200,500
Plant management salaries		210,000			2,236,500
Gross profit					1,411,500
Selling expenses
Packaging		87,500
Shipping		118,500
Sales salary (annual)		268,000			474,000
General and administrative expenses
Advertising expense		132,000
Salaries		241,000
Entertainment expense		93,500			466,500
Income from operations				$	471,000

Prepare a flexible budget performance report for 2015.

PHOENIX COMPANY
Flexible Budget Performance Report
For Year Ended December 31, 2015
	Flexible Budget	Actual Results	Variances	Fav. / Unfav.
Variable costs
	0	0
Fixed costs
	0	0