Phoenix Company's 2019 master budget included the following fixed budget report. It is based on an expected production and sales volume of 15,000 units. $3,150,000 PHOENIX COMPANY Fixed Budget Report For Year Ended December 31, 2019 Sales Cost of goods sold Direct materials Direct labor Machinery repairs (variable cost) Depreciation-Plant equipment (straight-line) Utilities ($30,000 is variable) Plant management salaries Gross profit Selling expenses Packaging Shipping Sales salary (fixed annual amount) General and administrative expenses Advertising expense Salaries Entertainment expense Income from operations $ 960,000 240,000 60,000 315,000 210,000 200,000 1,985,000 1,165,000 90,000 90,000 235,000 415,000 125,000 241,000 85,000 451,000 $ 299,000 Required: 1&2. Prepare flexible budgets for the company at sales volumes of 14,000 and 16,000 units and classify all items listed in the fixed budget as variable or fixed. PHOENIX COMPANY Flexible Budgets For Year Ended December 31, 2019 Flexible Budget Variable Amount per Total Fixed Cost Unit $ 210.00 Flexible Budget for: Units Unit Sales of Sales of 14,000 16,000 $ $ 2,940,000 3,360,000 Sales Variable costs Direct materials Direct labor Machinery repairs Utilities Packaging Shipping 64.00 16.00 4.00 2.00 6.00 6.00 896,000 224,000 56,000 28,000 84,000 84,000 1,024,000 256,000 64,000 32,000 96,000 96,000 98.00 112.00 1,372,000 156,000 1,568,000 1,792,000 Total variable costs Contribution margin Fixed costs DepreciationPlant equipment (straight-line) Utilities Plant management salaries Sales salary Advertising expense Salaries Entertainment expense 315,000 180,000 200,000 235,000 125,000 241,000 85,000 315,000 315,000 180,000 180,000 200,000 200,000 235,000 235,000 152,000 152,000 241,000 241,000 85,000 85,000 Total fixed costs $ 1,381,000 1,408,000 Income from operations $ 187,000 Red text indicates no response was expected in a cell or a formula-based calculation is incorrect: no points deducted. $ 1,408,000 $ 411,000