7-40 Budgeting, Behavior, and Ethics athew Philp, president of North Idaho Mining. Ltd., has made budgets a major focus for managers. ng budget was such an important goal that the only two managers who had missed their budgets Maki in20X7(by2% and 4%, respectively) had been summarily fired. This caused all managers to be wary when setting their 20X8 budgets. The Red Mountain Copper Division of North Idaho Mining had the following results for 20x7: Sales, 1.6 million pounds at $.95/pound $1,520,000 880,000 450,000 90,000 Variable costs Fixed costs, primarily depreciation Pretax profit Molly Stark, general manager of Red Mountain Copper, received a memo from Philp that con- tained the following: We expect your profit for 20X8 to be at least $209,000. Prepare a budget showing how you plan to accomplish this. was concerned because the market for copper had recently softened. Her market research staff forecast that sales would be at or below the 20X7 level, and prices would likely be between 7-40 Budgeting, Behavior, and Ethics athew Philp, president of North Idaho Mining. Ltd., has made budgets a major focus for managers. ng budget was such an important goal that the only two managers who had missed their budgets Maki in20X7(by2% and 4%, respectively) had been summarily fired. This caused all managers to be wary when setting their 20X8 budgets. The Red Mountain Copper Division of North Idaho Mining had the following results for 20x7: Sales, 1.6 million pounds at $.95/pound $1,520,000 880,000 450,000 90,000 Variable costs Fixed costs, primarily depreciation Pretax profit Molly Stark, general manager of Red Mountain Copper, received a memo from Philp that con- tained the following: We expect your profit for 20X8 to be at least $209,000. Prepare a budget showing how you plan to accomplish this. was concerned because the market for copper had recently softened. Her market research staff forecast that sales would be at or below the 20X7 level, and prices would likely be between