Tempo Company€™s fixed budget (based on sales of 7,000 units) for the first quarter of calendar year 2015 reveals the following. Prepare flexible budgets following the format of Exhibit 23.3 that show variable costs per unit, fixed costs, and three different flexible budgets for sales volumes of 6,000, 7,000, and 8,000 units.

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Fixed Budget Sales (7,000 units) Cost of goods sold Direct materials $2,800,000 $280,000 ....490,000 175,000 65,000 Production supplies Plant manager salary 1,010,000 1,790,000 Gross profit. Selling expenses Sales commissions 140,000 Advertising .. 25,000 419,000 Administrative expenses Administrative salaries 85,000 35,000 20,000 36,000176,000 Depreciation -office equip. Insurance Office rent Income from operations .. $1,195,000