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. PHOENIX COMPANY Fixed Budget Report For Year Ended December 31, 2019 Sales $3,000,000 Cost of goods sold Direct materials $975,000 Direct labor 225,000 Machinery repairs (variable cost) 60,000 Depreciation Plant 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 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 Flexible Budget for: Variable Amount Total Fixed Units Sales Unit Sales per Unit Cost of 14,000 of 16,000 $ $ 200.00 $2,800,000 3,000,000.00 Sales Variable costs Direct materials Direct labor Machinery repairs Utilities Packaging Shipping 65.00 15.00 4.00 975,000.00 225,000.00 60,000.00 45,000.00 75,000.00 105,000.00 910,000 210,000 56,000 42,000 70,000 98,000 3.00 5.00 7.00 99.00 1,386,000 0 Fixed costs Depreciation Plant equipment (straight-line) Utilities Plant management salaries Sales salary Advertising expense Salaries Entertainment expense 0 $ 0 $ 0 Total fixed costs Income from operations