Static Budget vs. Flexible Budget The production supervisor of the Painting Department for Whitley Company agreed to the following monthly static budget for the upcoming year: WHITLEY COMPANY Painting Department Monthly Production Budget Wages $589,000 Utilities 43,000 Depreciation Total 72,000 $704,000 The actual amount spent and the actual units produced in the first three months in the Painting Department were as follows: Amount Spent Units Produced January February March $665,000 631,000 72,000 65,000 607,000 59,000 The Painting Department supervisor has been very pleased with this performance, since actual expenditures have been less than the monthly budget. However, the plant manager believes that the budget should not remain fixed for every month but should "flex" or adjust to the volume of work that is produced in the Painting Department. Additional budget information for the Painting Department is as follows: Wages per hour Utility cost per direct labor hour Direct labor hours per unit Planned unit production $15.00 $1.10 0.50 hrs. 78,000 units a. Prepare a flexible budget for the actual units produced for January, February, and March in the Painting Department. Assume depreciation is a fixed cost. Enter all amounts as positive numbers. If required, round per unit amounts to the nearest cent. WHITLEY COMPANY Painting Department For the Three Months Ending March 31 January February March Units of production 72,000 65,000 59,000