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Noyell Company manufactures reverse umbrella. Below are the projected data of October 2021: Expected sales of October is 50,000 units at selling price $15 per

Noyell Company manufactures reverse umbrella. Below are the projected data of October 2021:

Expected sales of October is 50,000 units at selling price $15 per unit.

Cost of goods sold is expected to be 70% of sales.

Fixed selling and administrative expenses are:

  • Salaries expense $ 80,000
  • Supplies expense 35,000
  • Interest expense 9,000

Instructions

  1. Compute the budgeted net income for October 2021.
  2. Assume that the the company can sell 50,000 units at an average of $16 per unit at the end of October 2021, compute the difference between budgeted and actual net income.

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