Before the year began, the following static budget was developed for the estimated sales of 100,000. Sales are sluggish and management needs to revise its budget. Use this information to prepare a flexible budget for 80,000 and 90,000 units of sales. Flexible Budget100,00080,00090,000Sales$3,550,000 $Cost of Goods SoldDirect Material$900,000Direct Labor1,000,000Variable Manufacturing Overhead250,000Fixed Manufacturing Overhead70,000Cost of Goods Sold$2,220,000Gross Profit$1,330,000Variable Sales and Administrative Expenses200,000Fixed Sales and Administrative Expenses930,000Income Before Taxes$200,000 $Taxes60,000Net Income/Loss$140,000%24%24%24

Budget is a forecast or an estimate of future outcomes of an entity. It is prepared by entity to…

Before the year began, the following static budget was developed for the estimated sales of 100,000. Sales are sluggish and management needs to revise its budget. Use this information to prepare a flexible budget for 80,000 and 90,000 units of sales.

Before the year began, the following static budget was developed for the estimated sales of 100,000. Sales are sluggish and management needs to revise its budget. Use this information to prepare a flexible budget for 80,000 and 90,000 units of sales.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

Francis and Company has planned a cash budget for the third quarter of 2004. The cash balance on July 1, 2004 is expected to be an overdraft of $82,000. Extracts from the sales and purchases budgets are as follows: Budgeted Budgeted Purchases Month Sales $800,000 $900,000 May $600,000 $550,000 $450,000 $500,000 June July August September $750,000 $650,000 $800,000 All sales are on credit and an analysis of the records shows that debtors settle according to the following pattern, in accordance with the credit terms 5/30, n90: i) 50% in the month of sale 30% in the month following sale 20% the following month i1) All purchases are on credit and past experience shows that 80% are settled in the month of purchase in order to take advantage of a 10% prompt settlement discount. The balance will be disbursed in the month after purchase. The credit terms of the suppliers - 10/30, n60. Wages and salaries are expected to be $1,800,000 per annum and are paid iii) monthly. Fixed operating…
Before the year began, the following static budget was developed for the estimated sales of 100,000. Sales are sluggish and management needs to revise its budget. Use this information to prepare a flexible budget for 80,000 and 90,000 units of sales. Flexible Budget 100,000 80,000 90,000 Sales $3,580,000 $fill in the blank 1 $fill in the blank 2 Cost of Goods Sold Direct Material $900,000 $fill in the blank 3 $fill in the blank 4 Direct Labor 1,100,000 fill in the blank 5 fill in the blank 6 Variable Manufacturing Overhead 240,000 fill in the blank 7 fill in the blank 8 Fixed Manufacturing Overhead 70,000 fill in the blank 9 fill in the blank 10 Cost of Goods Sold $2,310,000 $fill in the blank 11 $fill in the blank 12 Gross Profit $1,270,000 $fill in the blank 13 $fill in the blank 14 Variable Sales and Administrative Expenses 100,000 fill in the blank 15 fill in the blank 16 Fixed Sales and Administrative Expenses 940,000 fill in the blank…
The actual information pertains to the third quarter. As part of the budgeting process, the Duck Decoy Department of Paralith Incorporated had developed the following static budget for the third quarter. Duck Decoy is in the process of preparing the flexible budget and understanding the results. Actual Results Flexible Budget Static Budget Sales volume (in units) 19,000 18,000 Sales revenues $240,000 $ $233,000 Variable costs 141,000 183,000 Contribution margin 99,000 50,000 Fixed costs 41,000 34,000 Operating profit $58,000 $ $16,000 The flexible budget will report ________ for the fixed costs. Do not give answer in image formate
You are given the following budgeted and actual data for the Grey Company for each of the months January through June of the current year. In December of the prior year, sales were forecasted as follows: January, 108 units; February, 103 units; March, 110 units; April, 115 units; May, 122 units; June, 130 units. In January of the current year, sales for the months February through June were reforecasted as follows: February, 98 units; March, 110 units; April, 110 units; May, 112 units; June, 125 units. In February of the current year, sales for the months March through June were reforecasted as follows: March, 105 units; April, 110 units; May, 107 units; June, 125 units. In March of the current year, sales for the months April through June were reforecasted as follows: April, 110 units; May, 102 units; June, 115 units. In April of the current year, sales for the months May and June were reforecasted as follows: May, 92 units; June, 110 units. In May of the current year, sales for June…
Vishu
3. Before the year began, the following static budget was developed for the estimated sales of 100,000. Sales are sluggish and management needs to revise its budget. Use this information to prepare a flexible budget for 80,000 and 90,000 units of sales. Sales $3,500,000 Cost of goods sold Direct material 900,000 Direct labor 1,000,000 Variable manufacturing overhead Fixed manufacturing overhead Cost of goods sold Gross profit Variable sales and administration expenses Fixed sales and administration expenses 250,000 80,000 2,230,000 1,270,000 100,000 950,000 Income before taxes 220,000 Таxes 66,000 Net income $ 154,000
Zaria Inc. provides the following budgeted data for producing 10,000 units of one of its products in its static budget for the next quarter: Sales per unit $60 Variable costs per unit $40 Fixed costs for the quarter $20,000 What would be the amount of operating income to be reported in the flexible budget prepared at a volume of 12,000 units? Group of answer choices $620,000 $216,000 $220,000 $300,000