Coronado 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 $ 270,000 Cost of goods sold (all variable) 175,000 Gross margin 95,000 Operating expenses 50,000 Operating income $ 45,000 Prepare a flexible budget based on sales of 1,000, 2,500, and 3,980 units. (Rou
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.
Coronado 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 | $ | 270,000 | ||
| Cost of goods sold (all variable) |
|
175,000 | ||
| Gross margin | 95,000 | |||
| Operating expenses |
|
50,000 | ||
| Operating income | $ | 45,000 |
Prepare a flexible budget based on sales of 1,000, 2,500, and 3,980 units. (Round unit values to 2 decimal places e.g. 15.25 and all other answers to 0 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).)
| Unit | 1,000 | 2,500 | 3,980 | |||||
|---|---|---|---|---|---|---|---|---|
| select an opening item | $enter a dollar amount | $enter a dollar amount | $enter a dollar amount | $enter a dollar amount | ||||
| select between addition and deduction select an opening section name | ||||||||
| select an item | enter a dollar amount | enter a dollar amount | enter a dollar amount | enter a dollar amount | ||||
| select an item | enter a dollar amount | enter a dollar amount | enter a dollar amount | enter a dollar amount | ||||
| select a closing section name | $enter a total amount for this section | enter a total amount for this section | enter a total amount for this section | enter a total amount for this section | ||||
| select a summarizing line for the first part | $enter a total amount for the first part | enter a total amount for the first part | enter a total amount for the first part | enter a total amount for the first part | ||||
| select an item | enter a dollar amount | enter a dollar amount | enter a dollar amount | |||||
| select a closing item | $enter a total amount for this budget | $enter a total amount for this budget | $enter a total amount for this budget |
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