Answered step by step
Verified Expert Solution
Question
1 Approved Answer
(12 pts) 7. The following information is available for 2021 for BAM Incorporated: Revenue (200,000 units) $1,600,000 Manufacturing costs: Materials cash costs 100,000 Variable
(12 pts) 7. The following information is available for 2021 for BAM Incorporated: Revenue (200,000 units) $1,600,000 Manufacturing costs: Materials cash costs 100,000 Variable overhead cash costs 80,000 Fixed overhead cash costs 125,000 Manufacturing depreciation 300,000 Marketing and administrative costs: Variable marketing cash costs 200,000 Marketing depreciation Administrative 180,000 50,000 20,000 Administrative depreciation Total costs Operating income $1,055,000 $545.000 All depreciation charges are expected to remain the same for 2022. Sales volume is expected to increase by 25 percent, but prices are expected to fall by 10 percent. Material costs are expected to decrease by 10 percent. Variable manufacturing overhead cash costs are expected to decrease by 10 percent per unit. Fixed manufacturing cash overhead costs are expected to increase by 10 percent. Variable marketing costs change with volume. Administrative cash costs are expected to increase by 5 percent. Inventories are kept at zero. Required: Prepare a budgeted income statement for 2022.
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started