Required:1&2. Prepare flexible budgets at sales volumes of 14,400 and 16,400 units.3. The company's business conditions are improving. One possible result is a sales volume of 18,400 units. Prepare a simple budgetedincome statement if 18,400 units are sold.Complete this question by entering your answers in the tabs below.Req 1 and 2Req 3Prepare flexible budgets at sales volumes of 14,400 and 16,400 units.PHOENIX COMPANYFlexible BudgetsFor Year Ended December 31Flexible BudgetVariable Amount Total Fixedper UnitCostFlexible Budget for:Units Sales Unit Sales ofof 14,400 16,400 Phoenix Company reports the following fixed budget. It is based on an expected production and sales volume of 15,400units.SalesCostaPHOENIX COMPANYFixed BudgetFor Year Ended December 31Direct materialsDirect laborSales staff commissionsDepreciation-MachinerySupervisory salariesShippingSales staff salaries (fixed annual amount)Administrative salariesDepreciation-office equipmentIncome$ 3,234,0001,001,000246,40046,200295,000198,000231,000251,000610,700193,000$ 161,700

Variable Cost :— It is the cost that changes with change in cost driver. Variable cost per units of…

Phoenix Company reports the following fixed budget. It is based on an expected production and sales volume of 15,400 units. Sales Costa PHOENIX COMPANY Fixed Budget For Year Ended December 31 Direct materials Direct labor Sales staff commissions Depreciation-Machinery Supervisory salaries. Shipping Sales staff salaries (fixed annual amount) - Administrative salaries Depreciation-office equipment Income $ 3,234,000 1,001,000 246,400 46,200 295,000 198,000 231,000 251,000 610,700 193,000 $ 161,700

Phoenix Company reports the following fixed budget. It is based on an expected production and sales volume of 15,400 units. Sales Costa PHOENIX COMPANY Fixed Budget For Year Ended December 31 Direct materials Direct labor Sales staff commissions Depreciation-Machinery Supervisory salaries. Shipping Sales staff salaries (fixed annual amount) - Administrative salaries Depreciation-office equipment Income $ 3,234,000 1,001,000 246,400 46,200 295,000 198,000 231,000 251,000 610,700 193,000 $ 161,700

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

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.

Question

Required:
1&2. Prepare flexible budgets at sales volumes of 14,400 and 16,400 units.
3. The company's business conditions are improving. One possible result is a sales volume of 18,400 units. Prepare a simple budgeted
income statement if 18,400 units are sold.
Complete this question by entering your answers in the tabs below.
Req 1 and 2
Req 3
Prepare flexible budgets at sales volumes of 14,400 and 16,400 units.
PHOENIX COMPANY
Flexible Budgets
For Year Ended December 31
Flexible Budget
Variable Amount Total Fixed
per Unit
Cost
Flexible Budget for:
Units Sales Unit Sales of
of 14,400 16,400

Phoenix Company reports the following fixed budget. It is based on an expected production and sales volume of 15,400
units.
Sales
Costa
PHOENIX COMPANY
Fixed Budget
For Year Ended December 31
Direct materials
Direct labor
Sales staff commissions
Depreciation-Machinery
Supervisory salaries
Shipping
Sales staff salaries (fixed annual amount)
Administrative salaries
Depreciation-office equipment
Income
$ 3,234,000
1,001,000
246,400
46,200
295,000
198,000
231,000
251,000
610,700
193,000
$ 161,700

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