R4 AssignmentSavedOutdoor Outfitters has created a flexible budget for the 70,000-unit and the 80,000-unit levels of activity shown as follows. CompleteOutdoor Outfitters's flexible budget at the 107,000-unit level of activity. Assume that the cost of goods sold and variable operatingexpenses vary directly with sales and that income taxes remain at 30 percent of operating income.70,000 Units80,000 Units107,000 Units$ 1,400,000 $ 1,600,000960,000SalesAskCost of goods sold840,000Gross profit on sales2$560,000 $640,000Operating expenses ($90,000 fixed)370,000190,000 $410,000Operating incomeIncome taxes (30% of operating income)230,00057,00069,000Net income133,000 $161,000McGrawHill< Prev5 of 20Next > Which of the following is not a benefit of a careful and thorough budgeting process?Multiple ChoiceAskThe budget may provide advance warning of pending problems.Budgeted net Income assures the company of operating profitably.Budgets provlde a yardstick for evaluating future performance.Budgeting Increases management's awareness of the company's external economic environment.< Prev7 of 20aw

Comment- Multiple Questions Asked 5) Flexible Budget- A flexible budget refers to the budget that…

Outdoor Outfitters has created a flexible budget for the 70,000-unit and the 80,000-unit levels of activity shown as follows. Complete Outdoor Outfitters's flexible budget at the 107,000-unit level of activity. Assume that the cost of goods sold and variable operating expenses vary directly with sales and that income taxes remain at 30 percent of operating income. 70,000 Units 80,000 Units 107,000 Units Sales $ 1,400,000 $ 840,000 1,600,000 Cost of goods sold 960,000 Gross profit on sales 2$ 560,000 $ 640,000 Operating expenses ($90,000 fixed) Operating income Income taxes (30% of operating income) 370,000 410,000 230,000 190,000 S 57,000 69,000 Net income 133,000 $ 161,000

Outdoor Outfitters has created a flexible budget for the 70,000-unit and the 80,000-unit levels of activity shown as follows. Complete Outdoor Outfitters's flexible budget at the 107,000-unit level of activity. Assume that the cost of goods sold and variable operating expenses vary directly with sales and that income taxes remain at 30 percent of operating income. 70,000 Units 80,000 Units 107,000 Units Sales $ 1,400,000 $ 840,000 1,600,000 Cost of goods sold 960,000 Gross profit on sales 2$ 560,000 $ 640,000 Operating expenses ($90,000 fixed) Operating income Income taxes (30% of operating income) 370,000 410,000 230,000 190,000 S 57,000 69,000 Net income 133,000 $ 161,000

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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le 12L x Connect neducation.com e i Saved Jones Company developed the following static budget at the beginning of the company's accounting period: Revenue (10, 500 units) $21,000 5,250 $15,750 5,250 $10,500 Variable costs Contribution margin Fixed costs Net income If actual production totals 10,900 units, the flexible budget would show total costs of: Multiple Choice
QUESTION 5 The following budgeted profit statement has been prepared using absorption costing principles.A company manufactures and sells a single product which has the following cost and sellingprice structure: P/unit P/unit Selling price P120 Direct material 22 Direct labour 36 Variable overhead 14 Fixed overhead 12 P84 Profit per unit P36 The fixed overhead absorption rate is based on the normal capacity of 2,000 units per month.Assume that the same amount is spent each month on fixed overheads.Budgeted sales for next month are 2,200 units.You are required to calculate:a. The breakeven point, in sales units per month. b. The margin of safety for the next month. c. The budgeted profit for the next month. d. The sales required to achieve a profit of P96,000.
QUESTION2 A company manufactures a single product. Budget and Standard cost details for next year include: Selling Price per unit R24.00 Variable Production cost per unit R8.60 Fixed production costs R650 000 Fixed selling and distrivution costs R230 400 Sales commission 5% of selling price Sales 90 000 units Required 1. Calculate the break-even point in units 2. Calculate the breakeven point in rands 3. Calculate the percentage by which the budgeted sales can fall before The company begins to make a loss 4. The marketing manager has suggested that the selling price per unit can be increased to R25.00.If the sales…
QUESTION 1 New Norm Fashion produces washable face mask shield. The following budgeted/ actual information is provided regardingto the production of face mask: RM/unit Selling price 50.00 Direct materials 8.00 Direct labour 5.00 Variable production overheads 3.00 Details of its operations for the month of May and June 2021 are as follows: May June Production 500 380 Sales 300 500 Fixed production overheads are budgeted at RM4,000 per month and are absorbed on a unit basis. The normal level of production is budgeted at 400 units per month. Other costs: RM/month Fixed selling 4,000 Fixed administration 2,000 Variable sales commission 5% of sales revenue There was no opening inventory of face mask at the beginning of May. Required: (a) Prepare income statement for the month of May and June using (i) variable costing (ii) absorption costing (b) Prepare a reconciliation of profit or loss figures based on your answers in a(i) and (c)Describe a situation where net profit under variable…
Ch. 8 Total Budgeted Cost of Goods Sold Problem. Please solve the following problem and explain each step. S&P's direct material cost is $6.50 per unit. The direct laboer is $30 per hour and each unit takes 1/2 hour to produce. Variablel Manufacturing Overhead is $2.75 per unit and total fixed overhead is $63,000. A sales commission of $5 is paid on each unit. If S&P expects to produce 9,000 units and sell 7,000 units, the total budgeted cost of goods sold for the year is?
Question 12 A company's flexible budget for 12,600 units of production showed sales, $54,180; variable costs, $22,680; and fixed costs, $22,000. The operating income expected if the company produces and sells 26,800 units is: O $115,240 O $61,060 O $48,240 O $45,000 O $79,960 Question 13 Five Rings, Inc, has collected the following data on one of its products: Direct materials standard (3 lbs.@ $.75/b.) F2 O+ SA F6 % D $2.25per finished unit F7 F8 s
QUESTION 1 Kiwenkira & Son Ltd makes and sells a single product marketed under a brand name Kiwetonic for the West African sub region and has total production capacity of 30,000 units per month. The budget for January 2020 contained the following information: Normal capacity (Units) 27,000 Variable costs per unit: Production (GH¢) 110 Selling and distribution (GH¢) 25 Fixed overheads: Production (GH¢) 756,000 Selling and administration (GH¢) 504,000 The actual operating data for January 2020 is as follows: Production 24,000 units Sales at GH¢250 per unit 22,000 units Opening inventory of finished goods 2,000 units During the month of January 2020, the variable factory overheads exceeded the budget by GH¢120,000. Required: Prepare profit statement for the month of January using: Marginal costing: and Absorption costing techiques Reconcile…
QUESTION 9 Rich & Sweet Candy Company's budgeted contribution income statement assumed it would produce and sell 5,000 units and includes the following: Total Sales Revenue Total Variable Costs $100,000 40,000 50,000 Total Fixed Costs In preparing its flexible budget given the actual units sold was 10% greater than budgeted, its total fixed costs would equal
Question A5 A company manufactures and sells one product. Budgeted sales units for the next period are 5,500. (a) Opening inventory is expected to be 400 units and planned to increase by 50% by the end of the period. What is the production budget in units? (b) Define the term 'Sunk cost'.
QUESTION 8 Avery Company has compiled the following data for the upcoming year: Sales are expected to be 13300 units at $31 each. • Each unit requires 2.1 pounds of direct materials at $2.1 per pound. • Each unit requires 0.7 hours of direct labor at $14 per hour. Manufacturing overhead is $6 per unit. Selling and administrative costs are $6 per unit What is Avery's budgeted cost of goods sold? M Az
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QUESTION 39 Complete the Flexible Budget Performance Report below: Sales Revenue Total Variable Costs Total Fixed Costs Total Variable Costs at 120 hours = Master Budget (100 hours) $2,000 $400 $300 Flexible Budget (120 hours) ? ? ?