Sacramento Electronics Corporation incurred the following costs during 20x1. The company sold all of Problem 2.58 its products manufactured during the year. Fixed and Variable ; ‘ Costs; Forecasting WikectiMatenalcarswr iensetae ce a uth A $ 2,900,000 (LO 4)
DifSehlawO nn me anes aap Leek Sn ty 1,950,000 Manufacturing overhead:
» Utilities (primarily electricity)... ................ 140,000 Depreciation on plant and equipment .......... 230,000 INSULAhOCke aan trea Tr eae ee 150,000 SUMSINISOMESALAHES Ny ee Ne ae ee 300,000 FIODEMLVIAXG Sayan certs nthe Sue ae ot 220,000 Selling costs:
RGN CHS Cea eeen ON ees ee te eee ee 195,000 SEES COMMISSIONS. ce oo acd pou des ee bee ease 90,000 Administrative costs:
Salaries of top management and staff.......... 369,000 OMICESUDOlIES= wei aa Gree hae a eee Dee 40,000 Depreciation on building and equipment........ 75,000 During 20x1, the company operated at about half of its capacity due to a slowdown in the economy.
Prospects for 20x2 are slightly better. The marketing manager forecasts a 20 percent growth in sales over the 20x1 level.
Required Categorize each of the preceding costs as most likely variable or fixed. Forecast the 20x2 amount for each cost item