Fixed Budget ReportFor Year Ended December 31, 2019Sales ....$3,000,000Cost of goods soldDirect materials .Direct labor......$975,000225,000Machinery repairs (variable cost)60,000Depreciation-Plant equipment (straight-line) .Utilities ($45,000 is variable) .300,000195,000....Plant management salaries200,0001,955,000Gross profit...1,045,000Selling expensesPackaging..75,000Shipping...105,000Sales salary (fixed annual amount) .250,000430,000General and administrative expensesAdvertising expense125,000Salaries.....241,000Entertainment expense90,000456,000$ 159,000Income from operationsa. Classify all items listed in the fixed budget as variable or fixed. Also determine theiramounts per unit or their amounts for the year, as appropriate.b. Identify the unit variable costs in the format of variable costing, according to yourfindings in part ac. Organize a template for variable costing income statements in which the sales volumeis a variable. Test your template for 15,000 units sales volume to see if you get thesame income as stated aboved. Find the breakeven point and provide the income statement at break evene. Provide income statement at sales volume 12,000, 14,000, 16,000, and 18,000 3. Phoenix Company's 2019 master budget included the following fixed budget report. It is basedon an expected production and sales volume of 15,000 units.

Name: Fixed Budget ReportFor Year Ended December 31, 2019Sales ....$3,000,0
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Description: Fixed Budget ReportFor Year Ended December 31, 2019Sales ....$3,000,000Cost of goods soldDirect materials .Direct labor......$975,000225,000Machinery repairs (variable cost)60,000Depreciation-Plant equipment (straight-line) .Utilities ($45,000 is va

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Fixed Budget Report For Year Ended December 31, 2019 Sales ... Cost of goods sold Direct materials ..... Direct labor..... $975,000 225,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Variance Analysis

In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.

Standard Costing

The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.

Topic Video

Question

Fixed Budget Report
For Year Ended December 31, 2019
Sales ....
$3,000,000
Cost of goods sold
Direct materials .
Direct labor......
$975,000
225,000
Machinery repairs (variable cost)
60,000
Depreciation-Plant equipment (straight-line) .
Utilities ($45,000 is variable) .
300,000
195,000
....
Plant management salaries
200,000
1,955,000
Gross profit...
1,045,000
Selling expenses
Packaging..
75,000
Shipping...
105,000
Sales salary (fixed annual amount) .
250,000
430,000
General and administrative expenses
Advertising expense
125,000
Salaries.....
241,000
Entertainment expense
90,000
456,000
$ 159,000
Income from operations
a. Classify all items listed in the fixed budget as variable or fixed. Also determine their
amounts per unit or their amounts for the year, as appropriate.
b. Identify the unit variable costs in the format of variable costing, according to your
findings in part a
c. Organize a template for variable costing income statements in which the sales volume
is a variable. Test your template for 15,000 units sales volume to see if you get the
same income as stated above
d. Find the breakeven point and provide the income statement at break even
e. Provide income statement at sales volume 12,000, 14,000, 16,000, and 18,000

3. Phoenix Company's 2019 master budget included the following fixed budget report. It is based
on an expected production and sales volume of 15,000 units.

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