Question
Problem 21-1A Preparing and analyzing a flexible budget LO P1, A1 [The following information applies to the questions displayed below.] Phoenix Companys 2019 master budget
Problem 21-1A Preparing and analyzing a flexible budget LO P1, A1
[The following information applies to the questions displayed below.] Phoenix Companys 2019 master budget included the following fixed budget report. It is based on an expected production and sales volume of 15,000 units.
| PHOENIX COMPANY Fixed Budget Report For Year Ended December 31, 2019 | |||||
| Sales | $ | 3,150,000 | |||
| Cost of goods sold | |||||
| Direct materials | $ | 900,000 | |||
| Direct labor | 240,000 | ||||
| Machinery repairs (variable cost) | 45,000 | ||||
| DepreciationPlant equipment (straight-line) | 315,000 | ||||
| Utilities ($45,000 is variable) | 195,000 | ||||
| Plant management salaries | 200,000 | 1,895,000 | |||
| Gross profit | 1,255,000 | ||||
| Selling expenses | |||||
| Packaging | 75,000 | ||||
| Shipping | 105,000 | ||||
| Sales salary (fixed annual amount) | 235,000 | 415,000 | |||
| General and administrative expenses | |||||
| Advertising expense | 150,000 | ||||
| Salaries | 241,000 | ||||
| Entertainment expense | 90,000 | 481,000 | |||
| Income from operations | $ | 359,000 | |||
Problem 21-1A Part 1&2
Required: 1&2. Prepare flexible budgets for the company at sales volumes of 14,000 and 16,000 units and classify all items listed in the fixed budget as variable or fixed.
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Managerial Accounting
Authors: Kulp, Susan, Dragoo, Amie, Hartgraves, Al L, Morse Wayne J.
9th Edition
1618533622, 9781618533623
