The director of Sonic Ltd has been asked to produce a budgeted income statement for the six months ending on 31 March 20X0. He forecasts that monthly sales will be £3,000 for October, £4,500 for each of November and December and £5,000 per month from January 20X0 onwards. Selling price is fixed to generate a margin on sales of 33 1/3%. Overhead expenses (excluding depreciation) are estimated at £800 per month. He plans to purchase non-current assets on 1 October costing £5,000, which will be paid for at the end of December and are expected to have a five-year life, at the end of which they will possess a nil residual value. What is the budgeted net profit for the six months ending 31 March 20X0? A. £3,700 B. £8,200 C. 3,200 D. 3,950

The director of Sonic Ltd has been asked to produce a budgeted income statement for the six months ending on 31 March 20X0. He forecasts that monthly sales will be £3,000 for October, £4,500 for each of November and December and £5,000 per month from January 20X0 onwards. Selling price is fixed to generate a margin on sales of 33 1/3%. Overhead expenses (excluding depreciation) are estimated at £800 per month. He plans to purchase non-current assets on 1 October costing £5,000, which will be paid for at the end of December and are expected to have a five-year life, at the end of which they will possess a nil residual value. What is the budgeted net profit for the six months ending 31 March 20X0? A. £3,700 B. £8,200 C. 3,200 D. 3,950

Principles of Accounting Volume 2

19th Edition

ISBN:9781947172609

Author:OpenStax

Publisher:OpenStax

Chapter7: Budgeting

Section: Chapter Questions

Problem 2PA: The data shown were obtained from the financial records of Italian Exports, Inc., for March: Sales...

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