2. Angel, Inc.. with P10,000,000 of par stock outstanding, plans to budget earnings of 6%, before income tax, on this stock: The marketing department budgets sales at P6,000,000. The budget director approves the sales budget and expenses s follows: Marketing 15% sales Administrative 5% of sales Financial 1% of sales Labor is expected to be 50% of the total manufacturing costs; materials issued for the budgeted production will cost P1,250,000; therefore any savings in manufacturing cost will have to be in factory overhead. Inventories are to be as follows: Jan. 1 Dec. 31 Finished goods Work in process Raw materials 400,000 50,000 250,000 500,000 150,000 200,000 Required: a. Budgeted Income Statement. b. Budgeted Cost of Goods manufactured and Sold. c. Budgeted Purchases and Materials.
2. Angel, Inc.. with P10,000,000 of par stock outstanding, plans to budget earnings of 6%, before income tax, on this stock: The marketing department budgets sales at P6,000,000. The budget director approves the sales budget and expenses s follows: Marketing 15% sales Administrative 5% of sales Financial 1% of sales Labor is expected to be 50% of the total manufacturing costs; materials issued for the budgeted production will cost P1,250,000; therefore any savings in manufacturing cost will have to be in factory overhead. Inventories are to be as follows: Jan. 1 Dec. 31 Finished goods Work in process Raw materials 400,000 50,000 250,000 500,000 150,000 200,000 Required: a. Budgeted Income Statement. b. Budgeted Cost of Goods manufactured and Sold. c. Budgeted Purchases and Materials.
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:2. Angel, Inc.. with P10,000,000 of par stock outstanding, plans
to budget earnings of 6%, before income tax, on this stock:
The marketing department budgets sales at P6,000,000. The budget
director approves the sales budget and expenses s follows:
Marketing 15% sales
Administrative 5% of sales
Financial 1% of sales
Labor is expected to be 50% of the total manufacturing costs;
materials issued for the budgeted production will cost
P1,250,000; therefore any savings in manufacturing cost will have
to be in factory overhead.
Inventories are to be as follows:
Jan. 1
Dec. 31
Finished goods
Work in process
Raw materials
400,000
50,000
250,000
500,000
150,000
200,000
Required:
a. Budgeted Income Statement.
b. Budgeted Cost of Goods manufactured and Sold.
c. Budgeted Purchases and Materials.
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