$2)$ Dewle, Inc$$s static budget for the year is shown below:

Sales $(25,000$ units$)$ $$1,400,000$

Cost of Goods Sold:

Direct Material $$140,000$

Direct Labor $300,000$

Overhead $($includes $$3$ per unit Variable cost$)165,000605,000$

Gross Profit $795,000$

Selling Expenses

Sales Commissions $($Variable$)40,000$

Rent $($Fixed$)90,000$

Insurance $($Fixed$)45,000$

General and administrative expenses

Salaries $($fixed$)190,000$

Rent $($Fixed$)60,000$

Depreciation $($Fixed$)70,000495,000$

$ $300,000$

Prepare a flexible budget for Rashad Inc. that shows a detailed budget for its static budget and its actual

sales volume of $30,000$ units. Use the contribution margin approach.

$25,000$ units $30,000$ units

Sales

Variable Cost:

Direct Materials

Direct Labor

Variable OH

Sales Commission

Total Variable Cost

Contribution Margin

Fixed Cost:

Fixed OH

Rent Expense $$ Selling

Insurance Expense

Salaries Expense

Rent Expense $$ General

Depreciation Expense

Total Fixed Cost

Income from Operations $2)$ Dewle, Inc's static budget for the year is shown below:

Prepare a flexible budget for Rashad Inc. that shows a detailed budget for its static budget and its actual sales volume of $30,000$ units. Use the contribution margin approach.

Sales

Variable Cost:

Direct Materials

Direct Labor

Variable OH

Sales Commission

Total Variable Cost

Contribution Margin

Fixed Cost:

Fixed OH

Rent Expense $-$ Selling

Insurance Expense

Salaries Expense

Rent Expense $-$ General

Depreciation Expense

Total Fixed Cost

Income from Operations