Concord Sports sells volleyball kits that it purchases from a sports equipment distributor. The following static budget based on sales of 2,500 kits was prepared for the year. Fixed operating expenses account for 75% of total operating expenses at this level of sales. Sales Revenue Cost of goods sold (all variable) Gross margin Operating expenses Operating income $ 240,000 $ 180,000 60,000 50,000 10,000 Prepare a flexible budget based on sales of 1,280, 2,860, and 3,780 units. (Round unit values to 2 decimal places e.g. 15.25 and all other answers to O decimal places, e.g. 1525. If operating income is negative, enter amounts using a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
Concord Sports sells volleyball kits that it purchases from a sports equipment distributor. The following static budget based on sales of 2,500 kits was prepared for the year. Fixed operating expenses account for 75% of total operating expenses at this level of sales. Sales Revenue Cost of goods sold (all variable) Gross margin Operating expenses Operating income $ 240,000 $ 180,000 60,000 50,000 10,000 Prepare a flexible budget based on sales of 1,280, 2,860, and 3,780 units. (Round unit values to 2 decimal places e.g. 15.25 and all other answers to O decimal places, e.g. 1525. If operating income is negative, enter amounts using a negative sign preceding the number e.g. -45 or parentheses e.g. (45).)
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Concept explainers
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
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Transcribed Image Text:Concord Sports sells volleyball kits that it purchases from a sports equipment distributor. The following static budget based on sales of
2,500 kits was prepared for the year. Fixed operating expenses account for 75% of total operating expenses at this level of sales.
Sales Revenue
Cost of goods sold (all variable)
Gross margin
Operating expenses
Operating income
Unit
LA
+A
$
Prepare a flexible budget based on sales of 1,280, 2,860, and 3,780 units. (Round unit values to 2 decimal places e.g. 15.25 and all other
answers to O decimal places, e.g. 1525. If operating income is negative, enter amounts using a negative sign preceding the number e.g.-45 or
parentheses e.g. (45).)
+A
$
$ 240,000
180,000
NO
$
60,000
LA
50,000
$
10,000
1,280
II
2,860
$
$
3,780
LA
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