please solve carefully, all experts made them wrongly. thanks Budgeted Income Statement and Supporting BudgetsThe budget director of Birds of a Feather Inc., with the assistance of the controller, treasurer, production manager, and sales manager, has gathered the following data for use in developing the budgeted income statement for January:Estimated sales for January: Birdhouse6,000 units at $55 per unit Bird feeder4,500 units at $75 per unitEstimated inventories at January 1:Direct materials: Wood220 ft. Plastic250 lb.Finished products: Birdhouse300 units at $23 per unit Bird feeder240 units at $34 per unitDesired inventories at January 31:Direct materials: Wood180 ft. Plastic210 lb.Finished products: Birdhouse340 units at $23 per unit Bird feeder200 units at $34 per unitDirect materials used in production:In manufacture of BirdHouse: Wood0.80 ft. per unit of product Plastic0.50 lb. per unit of productIn manufacture of Bird Feeder: Wood1.20 ft. per unit of product Plastic0.75 lb. per unit of productAnticipated cost of purchases and beginning and ending inventory of direct materials: Wood$8.00 per ft. Plastic$1.20 per lb.Direct labor requirements:Birdhouse: Fabrication Department0.20 hr. at $15 per hr. Assembly Department0.30 hr. at $12 per hr.Bird Feeder: Fabrication Department0.40 hr. at $15 per hr. Assembly Department0.35 hr. at $12 per hr.Estimated factory overhead costs for January:Indirect factory wages$80,000Depreciation of plant and equipment25,000Power and light8,000Insurance and property tax2,000Estimated operating expenses for January:Sales salaries expense$90,000Advertising expense20,000Office salaries expense18,000Depreciation expense—office equipment800Telephone expense—selling500Telephone expense—administrative200Travel expense—selling5,000Office supplies expense250Miscellaneous administrative expense450Estimated other income and expense for January:Interest revenue$300Interest expense224Estimated tax rate: 30%Prepare a budgeted income statement for January. Birds of a Feather Inc.Budgeted Income StatementFor the Month Ending January 31Revenue from sales Cost of goods sold Gross profit Selling and administrative expenses: Selling expenses Administrative expenses Total selling and administrative expenses Income from operations Other revenue: Interest revenue Other expenses: Interest expense Income before income tax Income tax (30% rate) Net income $

Budgeting is a process to prepare the financial statement by the manager to estimate the…

Answered: Prepare a budgeted income statement for…

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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Budgeted Income Statement and Supporting Budgets

The budget director of Birds of a Feather Inc., with the assistance of the controller, treasurer, production manager, and sales manager, has gathered the following data for use in developing the budgeted income statement for January:

Estimated sales for January:

Birdhouse 6,000 units at $55 per unit

Bird feeder 4,500 units at $75 per unit
Estimated inventories at January 1:

Direct materials:

  Wood 220 ft.

  Plastic 250 lb.

Finished products:

  Birdhouse 300 units at $23 per unit

  Bird feeder 240 units at $34 per unit
Desired inventories at January 31:

Direct materials:

  Wood 180 ft.

  Plastic 210 lb.

Finished products:

  Birdhouse 340 units at $23 per unit

  Bird feeder 200 units at $34 per unit

Direct materials used in production:

In manufacture of BirdHouse:
Wood	0.80 ft. per unit of product
Plastic	0.50 lb. per unit of product
In manufacture of Bird Feeder:
Wood	1.20 ft. per unit of product
Plastic	0.75 lb. per unit of product

Anticipated cost of purchases and beginning and ending inventory of direct materials:

Wood $8.00 per ft.

Plastic $1.20 per lb.

Direct labor requirements:

Birdhouse:
Fabrication Department	0.20 hr. at $15 per hr.
Assembly Department	0.30 hr. at $12 per hr.
Bird Feeder:
Fabrication Department	0.40 hr. at $15 per hr.
Assembly Department	0.35 hr. at $12 per hr.

Estimated factory overhead costs for January:

Indirect factory wages $80,000

Depreciation of plant and equipment 25,000

Power and light 8,000

Insurance and property tax 2,000

Estimated operating expenses for January:

Sales salaries expense	$90,000
Advertising expense	20,000
Office salaries expense	18,000
Depreciation expense—office equipment	800
Telephone expense—selling	500
Telephone expense—administrative	200
Travel expense—selling	5,000
Office supplies expense	250
Miscellaneous administrative expense	450

Estimated other income and expense for January:

Interest revenue $300

Interest expense 224
Estimated tax rate: 30%

Prepare a budgeted income statement for January.

Birds of a Feather Inc. Budgeted Income Statement For the Month Ending January 31
Revenue from sales
Cost of goods sold
Gross profit
Selling and administrative expenses:
	Selling expenses
	Administrative expenses
	Total selling and administrative expenses
Income from operations
Other revenue:
	Interest revenue
Other expenses:
	Interest expense
Income before income tax
Income tax (30% rate)
Net income		$

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