Required information [The following information applies to the questions displayed below.] Phoenix Company's 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,eee Cost of goods sold Direct materials $ 900, eee Direct labor 210, eee Machinery repairs (variable cost) 45, eee Depreciation-Plant equipment (straight-line) 338, eee Utilities ($30,000 is variable) 180, eee Plant Management salaries 200,000 1,865,cee Gross profit 1,285,000 Selling expenses Packaging 98,eee Shipping 98,eee Sales salary (Fixed annual anount) 235,000 415, eee General and administrative expenses Advertising expense 158, eee Salaries 238,eee Entertainment expense 90,000 478.cee Income front operations $ 400,000 Required: 182. 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. PHOENIX COMPANY Flexible Budgets For Year Ended December 31, 2019 Flexible Budget Variable Amount Total Fixed Cost Flexible Budget for: Units Sales Unit Sales of of 14,000 16,000 Per Unit Variable costs 0.00 0 Fixed costs $ 0 $ 0 $ 0 Required Information [The following information applies to the questions displayed below.] Phoenix Company's 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,eee Cost of goods sold Direct materials $ 900,000 Direct labor 210,000 Machinery repairs (variable cost) 45,000 Depreciation-Plant equipment (straight-line) 338,eee Utilities ($30,889 is variable) 188,888 Plant management salaries 288,eee 1,865, eee Gross profit 1,285,eee Selling expenses Packaging 90,000 Shipping 98,888 Sales salary (Fixed annual amount) 235, eee 415, eee General and administrative expenses Advertising expense 150,eee Salaries 238,eee Entertainment expense 90,000 479,800 Income from operations $ 4ee,eee 3. The company's business conditions are improving. One possible result is a sales volume of 18.000 units. The company president is confident that this volume is within the relevant range of existing capacity. How much would operating income increase over the budgeted amount of $400,000 if this level is reached without increasing capacity? PHOENIX COMPANY Forecasted Contribution Margin Income Statement For Year Ended December 31, 2019 Sales (in units) 15,000 18,000 Contribution margin (per unit) Contribution margin Fixed costs Operating income Required information [The following information applies to the questions displayed below.] Phoenix Company's 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,eee Cost of goods sold Direct materials $ 900,000 Direct labor 210, eee Machinery repairs (variable cost) 45,000 Depreciation-Plant equipment (straight-line) 330,eee Utilities ($30,889 is variable) 180,00 Plant management salaries 280, eee 1,865, eee Gross profit 1,285,eee Selling expenses Packaging 90,000 Shipping 98,00 Sales salary (fixed annual anount) 235, een 415,000 General and administrative expenses Advertising expense 150,00 Salaries 238, eee Entertainment expense 90,600 478,eee Income from operations $ 4ee,eee 4. An unfavorable change in business is remotely possible; In this case, production and sales volume for the year could fall to 12,000 units. How much Income (or loss) from operations would occur if sales volume falls to this level? (Enter any loss with minus sign.) PHOENIX COMPANY Forecasted Contribution Margin Income Statement For Year Ended December 31, 2019 Sales (in units) 15,000 12.000 Contribution margin (per unit) Contribution margin Fixed costs Operating income (loss)
