Tempo Company's fixed budget (based on sales of 14,000 units) folllows.

Fixed Budget
Sales (14,000 units $216 per unit)	3,024,000
Costs
Direct materials	350,000
Direct labor	602,000
Indirect materials	364,000
Supervisor salary	150,000
Sales commissions	98,000
Shipping	210,000
Administrative salaries	200,000
DepreciationOffice equipment	170,000
Insurance	140,000
Office rent	150,000
Income	590,000

1. Compute total variable cost per unit. 2. Compute total fixed costs. 3. Prepare a flexible budget at activity levels of 12,000 units and 16,000 units.

Prepare a flexible budget at activity levels of 12,000 units and 16,000 units.

TEMPO COMPANY
	Flexible Budget		Flexible Budget for:
	Variable Amount per Unit	Total Fixed Cost	Units Sales of 12,000	Unit Sales of 16,000
Sales	$216.00		$2,592,000
Variable costs
Direct materials	25.00		300,000	400,000
Direct labor	50.00
Indirect materials	26.00		312,000	416,000
Sales commissions
Shipping
Total variable costs	101.00		612,000	816,000
Contribution margin	$100.00		1,200,000	1,600,000
Fixed costs
Supervisor salary		150,000	150,000	150,000
Administration salaries		200,000	200,000	200,000
DepreciationOffice equipment		170,000	170,000	170,000
Insurance		140,000	140,000	140,000
Office rent		150,000	150,000	150,000
Total fixed costs		$810,000	$810,000	$810,000
Income			$390,000	$790,000

Complete the table