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Flexible Budget for Various Levels of Production Budgeted amounts for the year: Materials 2 leather strips @ $7.00 Labor 1.5 hr. @ $18.00 VOH 1.5 hr. @ $1.20 FOH $6,800 Required: 1. Prepare a flexible budget for 3,500, 4,000, and 4,500 units. Flexible Budget Variable Cost per Unit 3,500 units 4,000 units 4,500 units Direct materials $ $ $ Direct labor Variable overhead Fixed overhead Total Required: 1. Prepare a flexible budget for 3.500, 4,000, and 4,500 units. Flexible Budget Variable Cost per Unit 3,500 units 4,000 units 4,500 units Direct materials $ Direct labor Variable overhead Fixed overhead Total 2. CONCEPTUAL CONNECTION Calculate the unit costat 3.500, 4,000, and 4,500 units. (Note: Round unit costs to the nearest cent.) Unit costat 3,500 units Unit cost at 4,000 units Unit cost at 4,500 units What happens to unit cost as the number of units produced increases? The cost per unit as the number of units produced increases because fixed cost is spread over a greater number of units