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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