Writer One Inc. manufactures ball point pens that sell at wholesale for $0.80 per unit. Budgeted production in both 2018 and 2019 was 12,000 units. There was no beginning inventory in 2018. The following data summarized the 2018 and 2019 operations: 2018 2019 Units sold 10,500 10,000 Units produced 12,000 11,000 Costs: Variable factory overhead per unit $ 0.15 $ 0.15 Fixed factory overhead $ 2,400 $ 2,200 Variable marketing per unit $ 0.30 $ 0.30 Fixed Selling and Administrative $ 320 $ 320 Full costing operating income for 2019 is calculated to be: (Do not round intermediate calculations. Round your final answers to whole dollar amounts.) Multiple Choice $655. $1,180. $2,150. $171. $1,350.
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.
Writer One Inc. manufactures ball point pens that sell at wholesale for $0.80 per unit. Budgeted production in both 2018 and 2019 was 12,000 units. There was no beginning inventory in 2018. The following data summarized the 2018 and 2019 operations:
| 2018 | 2019 | |||||
| Units sold | 10,500 | 10,000 | ||||
| Units produced | 12,000 | 11,000 | ||||
| Costs: | ||||||
| Variable factory |
$ | 0.15 | $ | 0.15 | ||
| Fixed factory overhead | $ | 2,400 | $ | 2,200 | ||
| Variable marketing per unit | $ | 0.30 | $ | 0.30 | ||
| Fixed Selling and Administrative | $ | 320 | $ | 320 | ||
Full costing operating income for 2019 is calculated to be: (Do not round intermediate calculations. Round your final answers to whole dollar amounts.)
-
$655.
-
$1,180.
-
$2,150.
-
$171.
-
$1,350.
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