Requirement 1. Prepare flexible budget income statements for the company, showing output levels of 65,000, 70,000, and 75,000 kits. (Enter the per unit information to two decimal places.)

Precious Bubbles, Inc., produces multicolored bubble solution used for weddings and other events. (Click the icon to view the master budget income statement.) Precious Bubbles' plant capacity is 72,500 kits. If actual volume exceeds 72,500 kits, the company must expand the plant. In that case, salaries will increase by 10%, depreciation by 15%, and rent by $6,000. Fixed utilities will be unchanged by any volume increase. Requirement 1. Prepare flexible budget income statements for the company, showing output levels of 65,000, 70,000, and 75,000 kits. (Enter the per unit information to two decimal places.) Precious Bubbles, Inc. Flexible Budget Income Statement Month Ended January 31 Data Table Flexible Budget per Output Unit The company's master budget income statement for January follows. It is based on expected sales volume of 65,000 bubble kits. Output Units (Kits) 70,000 75,000 65.000 Sales revenue Variable expenses Cost of goods sold Sales commissions Utility expense Fixed expenses Salary expense Depreciation expense Rent expense Precious Bubbles, Inc. Master Budget Income Statement Month Ended January 31 $ 201,500 Sales revenue Variable expenses: Cost of goods sold $ 81,250 Sales commissions 13,000 Utility expense 9,750 Fixed expenses: Salary expense 33,000 Depreciation expense 18,000 Rent expense 9,000 3,000 Utility expense $ 167,000 Total expenses $ 34,500 Operating income Utility expense Total expenses Operating income Print Done