Gina Lakes Boating is the wholesale distributor of small recreational catamaran sailboats. Management has prepared the following summary data to use in its annual budgeting process: Budgeted sales (in units) 500 Selling price per unit $ 2,000 Cost per unit $ 1,600 Variable selling and administrative expenses (per unit) $ 75 Fixed selling and administrative expenses (per year) $ 105,500 Interest expense for the year $ 14,000 Required: Prepare the company’s budgeted income statement.
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.
Gina Lakes Boating is the wholesale distributor of small recreational catamaran sailboats. Management has prepared the following summary data to use in its annual budgeting process:
| Budgeted sales (in units) | 500 | |
| Selling price per unit | $ | 2,000 |
| Cost per unit | $ | 1,600 |
| Variable selling and administrative expenses (per unit) | $ | 75 |
| Fixed selling and administrative expenses (per year) | $ | 105,500 |
| Interest expense for the year | $ | 14,000 |
Required:
Prepare the company’s
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