Balmer Corporation's master (static) budget for the year is shown below:

Problem Information

Planned sales volume……………………………………………………………………………………………………………….	60000 units
Budgeted Sales Revenue…………………………………………………………………………………………………………..	$1,860,000
Budgeted Cost of Goods Sold:…………………………………………………………………………………………………….
Direct Materials………………………………………………………………………………………………………………..	$168,000
Direct Labor…………………………………………………………………………………………………………………..	$450,000
Manufacturing Overhead………………………………………………………………………………………………………	$240,000
Variable Overhead Rate, % of DL Cost …………………………………………………………………………………………..	0.4
Selling Expenses:
Sales Commissions (all variable)………………………………………………………………………………………………	$167,400
Rent (all short-term fixed)………………………………………………………………………………………………………	$40,000
Insurance (short-term fixed)……………………………………………………………………………………………………	$30,000
General Expenses:
Salaries (short-term fixed)………………………………………………………………………………………………………	$92,000
Rent (short-term fixed)…………………………………………………………………………………………………………	$77,000
Depreciation (short-term fixed)…………………………………………………………………………………………………	$50,000
Operating Income………………………………………………………………………………………………………………….	$545,600
Actual sales/production volume………………………………………………………………………………………………………	55000units
Actual sales/production volume………………………………………………………………………………………………………	65000units

Requirements

1. During the period the company actually manufactured and sold 55,000 units of product. Prepare an Excel spreadsheet that contains a flexible budget for this level of output.

2. Suppose, however, that the actual level of output had been 65,000 units of output. Rerun your spreadsheet to generate a flexible budget for this level of output.

3. Of what relevance is the notion of "relevant range" when preparing pro forma budgets or a flexible budget for control purposes?