Lowe & Rent is a law firm that specializes in probate work. Last year, the firm billed more hours than expected, but, as the following data show, profits were lower than anticipated.

a These are hours billed to clients. They are fewer than the number of hours worked because there is non-billable time (e.g., slack periods, time in training sessions) and because some time worked for clients is not charged to them.
Required
Prepare a flexible budget for Lowe & Rent. Use billable hours as the measure of output (that is, unitsproduced).

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Reported Income Master Statement Budget Billable hours Hevenue- Professional salaries (all variable) Other variable costs (e.g., supplies, computer services) .. Fixed costs. ... 6,900 $825,000 465,000 108,000 174,000 6,000 $750,000 375,000 102,000 180,000 Profit 78,000 93,000