FINANCIAL ACCOUNTING
FINANCIAL ACCOUNTING
10th Edition
ISBN: 9781259964947
Author: Libby
Publisher: MCG
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Phoenix Company reports the following fixed budget. It is based on an expected production and sales volume of 15,500 units.
 

PHOENIX COMPANY
Fixed Budget
For Year Ended December 31
Sales $ 3,255,000
Costs  
Direct materials 1,007,500
Direct labor 232,500
Sales staff commissions 77,500
Depreciation—Machinery 300,000
Supervisory salaries 199,000
Shipping 217,000
Sales staff salaries (fixed annual amount) 251,000
Administrative salaries 611,750
Depreciation—Office equipment 196,000
Income $ 162,750

 

 

 

Required:
1&2. Prepare flexible budgets at sales volumes of 14,500 and 16,500 units.
3. The company’s business conditions are improving. One possible result is a sales volume of 18,500 units. Prepare a simple budgeted income statement if 18,500 units are sold.

Prepare flexible budgets at sales volumes of 14,500 and 16,500 units.
Variable costs
Fixed costs
PHOENIX COMPANY
Flexible Budgets
For Year Ended December 31
Flexible Budget
Variable Amount Total Fixed
per Unit
Cost
Flexible Budget for:
Units Sales
of 14,500
Unit Sales of
16,500
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Transcribed Image Text:Prepare flexible budgets at sales volumes of 14,500 and 16,500 units. Variable costs Fixed costs PHOENIX COMPANY Flexible Budgets For Year Ended December 31 Flexible Budget Variable Amount Total Fixed per Unit Cost Flexible Budget for: Units Sales of 14,500 Unit Sales of 16,500
PHOENIX COMPANY
Budgeted Income Statement
For Year Ended December 31
Sales (in units)
18,500
expand button
Transcribed Image Text:PHOENIX COMPANY Budgeted Income Statement For Year Ended December 31 Sales (in units) 18,500
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