Rogers Sports sells volleyball kits that it purchases from a sports equipment distributor. The following static budget based on sales of 2,000 kits was prepared for the year. Fixed operating expenses account for 80% of total operating expenses at this level of sales.

Sales revenue........... $100,000

Cost of goods sold (all variable) ... 60,000

Gross margin.......... 40,000

Operating expenses ....... 35,000

Operating income ....... $ 5,000

Required

Prepare a flexible budget based on sales of 1,500, 2,500, and 3,500 units.