Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Phoenix Companys 2015 master budget included the following fixed budget report. It is based on an expected production and sales volume of 16,000 units. PHOENIX
Phoenix Companys 2015 master budget included the following fixed budget report. It is based on an expected production and sales volume of 16,000 units.
| PHOENIX COMPANY Fixed Budget Report For Year Ended December 31, 2015 |
| Sales | $ | 3,600,000 | |||
| Cost of goods sold | |||||
| Direct materials | $ | 880,000 | |||
| Direct labor | 160,000 | ||||
| Machinery repairs (variable cost) | 48,000 | ||||
| Depreciationplant equipment (straight-line) | 315,000 | ||||
| Utilities ($32,000 is variable) | 192,000 | ||||
| Plant management salaries | 230,000 | 1,825,000 | |||
| Gross profit | 1,775,000 | ||||
| Selling expenses | |||||
| Packaging | 64,000 | ||||
| Shipping | 96,000 | ||||
| Sales salary (fixed annual amount) | 260,000 | 420,000 | |||
| General and administrative expenses | |||||
| Advertising expense | 126,000 | ||||
| Salaries | 251,000 | ||||
| Entertainment expense | 110,000 | 487,000 | |||
| Income from operations | $ | 868,000 | |||
| Phoenix Companys actual income statement for 2015 follows. |
| PHOENIX COMPANY Statement of Income from Operations For Year Ended December 31, 2015 |
| Sales (19,000 units) | $ | 4,323,000 | |||
| Cost of goods sold | |||||
| Direct materials | $ | 1,062,000 | |||
| Direct labor | 198,000 | ||||
| Machinery repairs (variable cost) | 49,000 | ||||
| Depreciationplant equipment (straight-line) | 315,000 | ||||
| Utilities (fixed cost is $158,000) | 195,250 | ||||
| Plant management salaries | 239,000 | 2,058,250 | |||
| Gross profit | 2,264,750 | ||||
| Selling expenses | |||||
| Packaging | 74,000 | ||||
| Shipping | 106,500 | ||||
| Sales salary (annual) | 278,000 | 458,500 | |||
| General and administrative expenses | |||||
| Advertising expense | 134,000 | ||||
| Salaries | 251,000 | ||||
| Entertainment expense | 114,000 | 499,000 | |||
| Income from operations | $ | 1,307,250 | |||
| Required: | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| 1. | Prepare a flexible budget performance report for 2015. | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
| Answer is not complete
| ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Step by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access with AI-Powered 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