Phoenix Company's 2017 master budget included the following fixed budget report. It is based on an expected production and sales volume of 18,000 units. $3,600,000 PHOENIX COMPANY Fixed Budget Report For Year Ended December 31, 2017 Sales Cost of goods sold Direct materials $900,000 Direet labor 360,000 Machinery repairs (variable cost) 36,000 Depreciation-Plant equipment (straight-line) 315,000 Utilities ($18,000 is variable) 178,000 Plant Management salaries 215,000 Gross profit Selling expenses Packaging 54,000 Shipping 90,000 Sales salary (fixed annual amount) 260,000 General and administrative expenses Advertising expense 129,000 Salaries 261,000 Entertainment expense 90,000 Income from operations 2,004,000 1,596,000 404,000 480.000 712,000 $ Phoenix Company's actual income statement for 2017 follows. PHOENIX COMPANY Statement of Income from Operations For Year Ended December 31, 2017 Sales (21,000 unita) Cost of goods sold Direct materials $1.066,000 Direct labor 427.000 Machinery repairs variable cost) 34.000 Depreciation-Plant equipment (straight-line) 315.000 Utilities (fixed cost is $157, 500) 177.750 Plant management salaries 226,000 Gross profit Selline a s 2,245,250 2,032,250 315,000 177,750 226,000 2,245,750 2,032,250 Depreciation-Plant equipment (straight-line) Utilities (fixed cost is $157,500) Plant management salaries Gross profit Selling expenses Packaging Shipping Sales salary (annual) General and administrative expenses Advertising expense Salaries Entertainment expense Income from operations 60,500 97,500 278,000 436,000 136,000 261,000 94,000 491,000 $1,105, 250 Required: 1. Prepare a flexible budget performance report for 2017. PHOENIX COMPANY Flexible Budget Performance Report For Year Ended December 31, 2017 Flexible Budget Actual Results Variances Fav. / Unfav. Variable costs For Year Ended December 31, 2017 Flexible Budget Actual Results Variances Fav. / Unfav. Variable costs IIIIIIIIIIIIIIII Fixed costs