Use the following data for problems 10-12: Barth Company is preparing the operating budget for the first quarter of 2024. They forecast sales of $75,000 in January, $80,000 in February, and $85,000 in March. Cost of goods sold is budgeted at 45% of Sales. Variable and fixed expenses are as follows: Variable: Miscellaneous expenses: 22% of Sales Fixed: Salary expense: $15,000 per month Rent expense: $3,000 per month Depreciation expense: $2,000 per month Miscellaneous expenses/fixed portion: $1,000 per month

Use the following data for problems 10-12: Barth Company is preparing the operating budget for the first quarter of 2024. They forecast sales of $75,000 in January, $80,000 in February, and $85,000 in March. Cost of goods sold is budgeted at 45% of Sales. Variable and fixed expenses are as follows: Variable: Miscellaneous expenses: 22% of Sales Fixed: Salary expense: $15,000 per month Rent expense: $3,000 per month Depreciation expense: $2,000 per month Miscellaneous expenses/fixed portion: $1,000 per month

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter8: Budgeting For Planning And Control

Section: Chapter Questions

Problem 10CE: Coral Seas Jewelry Company makes and sells costume jewelry. For the coming year, Coral Seas expects...

See similar textbooks

Similar questions

Carmichael Corporation is in the process of preparing next years budget. The pro forma income statement for the current year is as follows: Required: 1. What is the break-even sales revenue (rounded to the nearest dollar) for Carmichael Corporation for the current year? 2. For the coming year, the management of Carmichael Corporation anticipates an 8 percent increase in variable costs and a 60,000 increase in fixed expenses. What is the break-even point in dollars for next year? (CMA adapted)
Coral Seas Jewelry Company makes and sells costume jewelry. For the coming year, Coral Seas expects sales of 15.9 million and cost of goods sold of 8.75 million. Advertising is a key part of Coral Seas business strategy, and total marketing expense for the year is budgeted at 2.8 million. Total administrative expenses are expected to be 675,000. Coral Seas has no interest expense. Income taxes are paid at the rate of 40 percent of operating income. Required: 1. Construct a budgeted income statement for Coral Seas Jewelry Company for the coming year. 2. What if Coral Seas had interest payments of 500,000 during the year? What effect would that have on operating income? On income before taxes? On net income?
Sheffield Company combines its operating expenses for budget purposes in a selling and administrative expenses budget. For the first six months of 2022, the following data are available: 1. 2 3. 4 Sales: 19,800 units in quarter 1: 21.300 units in quarter 2 D Variable costs per dollar of sales: sales commissions 5%; delivery expense 2%; and advertising 4% Fixed costs per quarter: sales salaries $10,700; office salaries $8,300: depreciation $4,300; insurance $1,300: utilities $800; and repairs expense $600 Unit selling price: $19 Prepare a selling and administrative expenses budget by quarters for the first six months of 2022 SHEFFIELD COMPANY Selling and Administrative Expenses Budget For the Six Months Ending June 30, 2022 2 Total
The actual selling expenses incurred in March 2020 by Fallon Company are as follows. Variable Expenses Fixed Expenses Sales commissions $11,180 Sales salaries $35,500 Advertising 10,530 Depreciation 7,400 Travel 6,920 Insurance 1,100 Delivery 3,580 (b) Prepare a flexible budget performance report, assuming that March sales were $180,500. (List variable costs before fixed costs.) FALLON COMPANYSelling Expense Flexible Budget ReportFor the Month Ended March 31, 2020 Difference Budget Actual FavorableUnfavorableNeither Favorablenor Unfavorable Select an opening flexible budget report item AdvertisingDepreciationDeliveryFixed ExpensesInsuranceSalesSales CommissionsSales SalariesTotal ExpensesTotal Fixed ExpensesTotal Variable ExpensesTravelVariable Expenses $Enter a dollar amount $Enter a dollar amount Select an opening name for…
Pearl, Inc. has prepared the operating budget for the first quarter of the year. The company forecast sales of $45,000 in January, $55,000 in February, and $65,000 in March. Variable and fixed selling and administrative expenses are as follows: Variable Expenses: Power cost Miscellaneous expenses Fixed Expenses: Salaries expense Rent expense Depreciation expense Power cost/fixed portion Miscellaneous expense/fixed portion OA. $35,300 OB. $40,300 OC. $22,500 OD. $45,300 (40% of sales) (10% sales) $6,000 per month $4,000 per month $1,000 per month $800 per month $1,000 per month
The actual selling expenses incurred in March 2020 by Fallon Company are as follows. Variable Expenses Fixed Expenses Sales commissions $11,180 Sales salaries $35,500 Advertising 10,530 Depreciation 7,400 Travel 6,920 Insurance 1,100 Delivery 3,580 (a) Prepare a flexible budget performance report for March, assuming that March sales were $173,000. Variable costs and their percentage relationship to sales are sales commissions 6%, advertising 6%, traveling 4%, and delivery 2%. Fixed selling expenses will consist of sales salaries $35,500, Depreciation on delivery equipment $7,400, and insurance on delivery equipment $1,100. (List variable costs before fixed costs.) FALLON COMPANYSelling Expense Flexible Budget ReportFor the Month Ended March 31, 2020 Difference Budget Actual FavorableUnfavorableNeither Favorablenor Unfavorable Select an opening flexible budget report item…
Advanced Enterprises reports year- end information from 2018 as follows: Sales (161,250 units) $967,000 Cost of goods sold 645,000 Gross margin 322,000 Operating expenses Operating income 265,000 S57,000 Advanced is developing the 2019 budget. In 2019 the company would like to increase selling prices by 13.5%, and as a result expects a decrease in sales volume of 10%. All other operating expenses are expected to remain constant. Assume that cost of goods soid is a variable cost and that operating expenses are a fixed cost. What is budgeted cost of goods sold for 2019? O A. $709.500 OB. $580.500 OC. $732,075 O D. $645,000
The actual selling expenses incurred in March 2020 by Fallon Company are as follows. Variable Expenses Fixed Expenses Sales commissions $14,228 Sales salaries $35,000 Advertising 10,086 Depreciation 7,200 Travel 8,355 Insurance 1,900 Delivery 3,422 (a) Prepare a flexible budget performance report for March, assuming that March sales were $167,100. Variable costs and their percentage relationship to sales are sales commissions 8%, advertising 6%, traveling 5%, and delivery 2%. Fixed selling expenses will consist of sales salaries $35,000, Depreciation on delivery equipment $7,200, and insurance on delivery equipment $1,900. (List variable costs before fixed costs.)
The actual selling expenses incurred in March 2020 by Fallon Company are as follows. Variable Expenses Fixed Expenses Sales commissions $10,994 Sales salaries $35,400 Advertising 10,304 Depreciation 7,100 Travel 8,470 Insurance 1,300 Delivery 3,498 (a) Prepare a flexible budget performance report for March, assuming that March sales were $169,400. Variable costs and their percentage relationship to sales are sales commissions 6%, advertising 6%, traveling 5%, and delivery 2%. Fixed selling expenses will consist of sales salaries $35,400, Depreciation on delivery equipment $7,100, and insurance on delivery equipment $1,300. (List variable costs before fixed costs.) (b)Prepare a flexible budget performance report, assuming that March sales were $176,700. (List variable costs before fixed costs.)
! Required information SB Exercise E8-5 to E8-10 [The following information applies to the questions displayed below.] Shadee Corporation expects to sell 630 sun shades in May and 420 In June. Each shade sells for $147. Shadee's beginning and ending finished goods Inventories for May are 75 and 55 shades, respectively. Ending finished goods Inventory for June will be 60 shades. E8-10 (Algo) Preparing Budgeted Income Statement [LO 8-3h] Each shade requires a total of $50.00 in direct materials that includes 4 adjustable poles that cost $10.00 each. Shadee expects to have 130 in direct materials inventory on May 1, 80 poles in inventory on May 31, and 110 poles in inventory on June 30. Suppose that each shade takes three direct labor hour to produce and Shadee pays its workers $15 per hour. Additionally, Shadee's fixed manufacturing overhead is $10,000 per month, and variable manufacturing overhead is $13 per unit produced. Additional information: • Selling costs are expected to be 6…
The Management Accountant of Kafululu Plc has prepared the following budget information for theyear ending 31st December 2022 for product A. Annual Fixed Costs K270,000.00 Variable costs per unit K90.00 Contribution to sales ratio(C/S) 75% Annual budget units 1,500 Required:a) Calculate the contribution per unit for Product A. b) Calculate the Unit Selling Price for Product A. c) Calculate the Break Even Point for Product A. d) Calculate the margin of safety in Units and in percentage terms. e) If the Selling Price per Unit is reduced by 10%, variable cost per Unit is increased to K100.00and Fixed costs remain unchanged, calculate:i. The new Breakeven Point. ii. The total units that should be sold in order to make a profit of K450,000 in 2020.(
Zelia, Inc. has prepared the operating budget for the first quarter of the year. The company forecast sales of $50,000 in January, $60,000 in February, and $70,000 in March. Variable and fixed expenses are as follows: Variable Expenses: Power cost (20% of sales) Miscellaneous expenses: (10% of sales) Fixed Expenses: Salaries expense: $10,000 per month Rent expense: $5,000 per month Depreciation expense: $1,400 per month Power cost/fixed portion: $500 per month Miscellaneous expenses/fixed portion: $1,000 per month Using the information above, calculate the amount of budgeted selling and administrative expenses for the month of February. A. $18,000 B. $32,900 C. $38,900 D. $35,900 Click to select your