Gibson Corporation, which has three divisions, is preparing its sales budget. Each division expects a different growth rate becam economic conditions vary in different regions of the country. The growth expectations per quarter are 4 percent for Cummings Division, 2 percent for Springfield Division, and 6 percent for Douglas Division. Required a. Complete the sales budget by filling in the missing amounts. b. Determine the amount of sales revenue that the company will report on its quarterly pro forma income statements. Complete this question by entering your answers in the tabs below.

Gibson Corporation, which has three divisions, is preparing its sales budget. Each division expects a different growth rate becam economic conditions vary in different regions of the country. The growth expectations per quarter are 4 percent for Cummings Division, 2 percent for Springfield Division, and 6 percent for Douglas Division. Required a. Complete the sales budget by filling in the missing amounts. b. Determine the amount of sales revenue that the company will report on its quarterly pro forma income statements. Complete this question by entering your answers in the tabs below.

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

See similar textbooks

Similar questions

B.2.A. The budget committee of Red Rose Company has the following data for preparing budgeted income statement for January 2022. 2- • Sales amount is expected to be $700,000. • Cost of goods sold is expected to be 75% of sales • Operating expenses are estimated to be: Sales Salaries $ 30,000 Advertising Delivery expense 5% of the monthly sales 3% of the monthly sales 4% of the monthly sales $ 5,000 per month $ 800 per month $ 600 per month $ 500 per month Sales Commissions Rent expense Depreciation Utilities Insurance • Income taxes are estimated to be 30% of income from operations Prepare "budgeted income statement" for January.
The marketing department of Jessi Corporation has submitted the following sales forecast for the upcoming fiscal year (all sales are on account): 1st Quarter 11,000 2nd Quarter 12,000 3rd Quarter 4th Quarter 13,000 Budgeted unit sales 14,000 The selling price of the company's product is $18.00 per unit. Management expects to collect 65% of sales in the quarter in which the sales are made, 30% in the following quarter, and 5% of sales are expected to be uncollectible. The beginning balance of accounts receivable, all of which is expected to be collected in the first quarter, is $70,200. The company expects to start the first quarter with 1,650 units in finished goods inventory. Management desires an ending finished goods inventory in each quarter equal to 15% of the next quarter's budgeted sales. The desired ending finished goods inventory for the fourth quarter is 1,850 units. Required: 1. Calculate the estimated sales for each quarter of the fiscal year and for the year as a whole. 2.…
Shaak Corporation uses customers served as its measure of activity. The company bases its budgets on the following information: Revenue should be $6.30 per customer served. Wages and salaries should be $22,300 per month plus $0.90 per customer served. Supplies should be $0.80 per customer served. Insurance should be $5,950 per month. Miscellaneous expenses should be $4,400 per month plus $0.20 per customer served. The company reported the following actual results for October: Customers served Revenue. Wages and salaries Supplies Insurance Miscellaneous expense Required: Prepare a report showing the company's revenue and spending variances for October. Label each variance as favorable (F) or unfavorable (U). Note: Indicate the effect of each variance by selecting "F" for favorable, "U" for unfavorable, and "None" for no effect (i.e., zero variance). Input all amounts as positive values. Customers served Revenue Expenses: Wages and salaries Supplies Insurance 22,750 $ 177,300 $ 40,725 $…
Compute the degree of operating leverage that OMS would expect to have as at 31 December 2022 under the following scenarios:(i) Using independent sales agents’ commission at 15%.(ii) Using independent sales agents’ commission at 20%.(iii) Using the company’s own hired sales team.Use operating income before taxes in the above computation.
Molander Corporation is a distributor of a sun umbrella used at resort hotels. Data concerning the next month’s budget appear below: Selling price per unit $ 24 Variable expense per unit $ 17 Fixed expense per month $ 5,950 Unit sales per month 1,000 Required: 1. What is the company’s margin of safety? (Do not round intermediate calculations.) 2. What is the company’s margin of safety as a percentage of its sales? (Round your percentage answer to 2 decimal places (i.e. .1234 should be entered as 12.34).) 1. Margin of safety (in dollars) 2. Margin of safety percentage %
Executive officers of Fanning Company are wrestling with their budget for the next year. The following are two different sales estimates provided by two different sources. Source of Estimate Sales manager Marketing consultant Fanning's past experience indicates that cost of goods sold is about 60 percent of sales revenue. The company tries to maintain 20 percent of the next quarter's expected cost of goods sold as the current quarter's ending inventory. This year's ending inventory is $25,000. Next year's ending inventory is budgeted to be $26,000. Required a. Prepare an inventory purchases budget using the sales manager's estimate. b. Prepare an inventory purchases budget using the marketing consultant's estimate. Complete this question by entering y Assessment Tool iFrame tabs below. Show Transcribed Text First Quarter Second Quarter $ 383,000 $ 304,000 527,000 470,000 Sales Required A Required B Required A Prepare y purchases budget using the sales manager's estimate. Note: Round…
Stuart Corporation, which has three divisions, is preparing its sales budget. Each division expects a different growth rate because economic conditions vary in different regions of the country. The growth expectations per quarter are 4 percent for Cummings Division, 2 percent for Springfield Division, and 6 percent for Douglas Division. Required a. Complete the sales budget by filling in the missing amounts. b. Determine the amount of sales revenue that the company will report on its quarterly pro forma income statements. Complete this question by entering your answers in the tabs below. Required A Required B Complete the sales budget by filling in the missing amounts. Note: Round your final answers to the nearest whole dollar amount. Division First Quarter Second Third Quarter Quarter Fourth Quarter Cummings Division $ 100,000 Springfield Division 400,000 Douglas Division 220,000
It is budgeting time for Rod Co. The following assumptionswere agreed upon for the next year after strategic planning,which covered a five-year horizon: 1. Sales are estimated tobe at 70,000 units at its national selling price of P126. 2.Sales discounts are given to various customers at differentrates, and the net to gross ratio is at 93%. 3. Markup onmerchandise is at 45% of the invoice cost. Beginninginventory is P80,900 and is expected to be reduced byP15,000 at the end of the period. 4. Selling andadministrative expenses are expected to be 15% of grosssales. 5. Depreciation is computed at P500,000. 6. Seventy-five percent (75%) of sales are on credit. Doubtful accountsexpense is estimated to be 1.5% of credit sales. Required:What is the budgeted income statement for Rod Co.
The manager of the Dallas Division of Walking Tours of America is preparing the budget for 2021. At this point, she has determined that average total assets for 2021 will equal $4,000,000. She is evaluated on the amount of residual income generated by her division. Assume variable costs in Dallas Division are expected to equal 60% of total sales and fixed costs are expected to equal $400,000 in 2021. 1. Compute the sales level that would generate a 20% return on investment. 2. Assuming the rate of return is 15%, determine the level of sales that would generate $200,000 of residual income.
Prepare a complete projected income statement in the contribution format for each scenario, in the manner of a flexible budget. Please show work Carolina Manufacturing Company has been operating at a loss for several years. A management team has assembled to determine what course of action to take next year to reach profitability. They begin by reviewing the most recent income statement (below). Carolina Manufacturing Company Income Statement For the Year Ended December 31 Sales (45,000 units at $15) Less cost of goods sold: Net loss Direct materials Direct labor Manufacturing overhea Gross margin Less operating expenses Selling expenses Variable Sales commissions Shipping 135,000 117,450 147,750 Fixed (advertising, salaries) Administrative expenses Variable (billing and other) Fixed (salaries and other) 40,500 8,100 180,000 $675,000 400,200 274,800 228,600 2,700 72,000 74,700 ($28,500)
Molander Corporation is a distributor of a sun umbrella used at resort hotels. Data concerning the next month's budget appear below: Selling price per unit Variable expense per unit Fixed expense per month Unit sales per month $ $ $ 7,920 1,030 27 18 Required: 1. What is the company's margin of safety? (Do not round intermediate calculations.) 2. What is the company's margin of safety as a percentage of its sales? (Round your percentage answer to 2 decimal places (i.e. 0.1234 should be entered as 12.34).) 1. Margin of safety (in dollars) 2. Margin of safety percentage %
South Hampton University is preparing its budget for the upcoming academic year. This is a specialisedprivate university that charges fees for all degree courses. Currently, 30,000 students are enrolled oncampus. However, the university is forecasting a 5 per cent growth in student numbers in the comingyear, despite an increase in fees to $3,000 per subject. The following additional information has beengathered from an examination of university records and conversations with university managers: South Hampton is planning to award scholarships to 200 students, which will cover their fees. The average class has 80 students, and the typical student takes 4 subjects per semester. SouthHampton operates 2 semesters per year. The average academic staff salary is $120,000 per annum including on-costs. South Hampton’s academic staff are evaluated on the basis of teaching, research, administrationand professional/community service. Each of the academic staff teaches the equivalent of…