Mansfield Information Systems (MIS) is an IT support firm. Managers and staff are billed to clients on an hourly basis. The senior administrative staff does not directly provide client support. Because of the clientele of MIS, there is significant fluctuation from month to month. Managers are billed to clients at a rate of $700 per hour and staff at a rate of $350 per hour. Managers are paid $210 per hour worked (including nonbillable time), and staff are paid $130 per hour. The current plan calls for managers to bill 800 hours in November and 620 hours in December. Staff are expected to bill 6,100 hours In November and 4,800 hours In December. Managers will work a total of 1,120 hours in both months, and staff will work a total of 7,800 hours in November and 6,000 hours in December. Other monthly costs (all fixed) are $750,000 selling, general, and administrative, $150,000 in depreciation, and $250,000 in marketing. Required: Prepare a budgeted Income statement for Mansfield Information Systems for November and December (separately). Revenues: Managers Staff Total revenue Expenses: Manager pay Staff pay Total compensation Selling general, and administrative Depreciation Marketing Total expenses Mansfield Information Systems Budgeted Income Statement. Income (loss) November S S December 05 0 S 0 S 0 S 0 0
Mansfield Information Systems (MIS) is an IT support firm. Managers and staff are billed to clients on an hourly basis. The senior administrative staff does not directly provide client support. Because of the clientele of MIS, there is significant fluctuation from month to month. Managers are billed to clients at a rate of $700 per hour and staff at a rate of $350 per hour. Managers are paid $210 per hour worked (including nonbillable time), and staff are paid $130 per hour. The current plan calls for managers to bill 800 hours in November and 620 hours in December. Staff are expected to bill 6,100 hours In November and 4,800 hours In December. Managers will work a total of 1,120 hours in both months, and staff will work a total of 7,800 hours in November and 6,000 hours in December. Other monthly costs (all fixed) are $750,000 selling, general, and administrative, $150,000 in depreciation, and $250,000 in marketing. Required: Prepare a budgeted Income statement for Mansfield Information Systems for November and December (separately). Revenues: Managers Staff Total revenue Expenses: Manager pay Staff pay Total compensation Selling general, and administrative Depreciation Marketing Total expenses Mansfield Information Systems Budgeted Income Statement. Income (loss) November S S December 05 0 S 0 S 0 S 0 0
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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Transcribed Image Text:Mansfield Information Systems (MIS) is an IT support firm. Managers and staff are billed to clients on an hourly basis. The senlor
administrative staff does not directly provide client support. Because of the clientele of MIS, there is significant fluctuation from month
to month.
Managers are billed to clients at a rate of $700 per hour and staff at a rate of $350 per hour. Managers are paid $210 per hour worked
(including nonbillable time), and staff are paid $130 per hour. The current plan calls for managers to bill 800 hours in November and
620 hours in December. Staff are expected to bill 6,100 hours in November and 4,800 hours in December Managers will work a total
of 1,120 hours in both months, and staff will work a total of 7,800 hours in November and 6,000 hours in December.
Other monthly costs (all fixed) are $750,000 selling, general, and administrative, $150,000 in depreciation, and $250,000 in marketing.
Required:
Prepare a budgeted Income statement for Mansfield Information Systems for November and December (separately).
Revenues:
Managers
Staff
Total revenue
Expenses:
Manager pay
Staff pay
Total compensation
Selling general, and administrative
Depreciation
Marketing
Total expenses
Mansfield Information Systems
Budgeted Income Statement
Income (loss)
November
S
S
S
S
December
5
S
0 S
S
0
0
0
0
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