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Tempo Company's fixed budget (based on sales of 16,000 units) for the first quarter reveals the following. Fixed Budget Sales (16,000 units $212 per unit)
Tempo Company's fixed budget (based on sales of 16,000 units) for the first quarter reveals the following.
Fixed Budget | ||||||||
Sales (16,000 units $212 per unit) | $ | 3,392,000 | ||||||
Cost of goods sold | ||||||||
Direct materials | $ | 400,000 | ||||||
Direct labor | 688,000 | |||||||
Production supplies | 448,000 | |||||||
Plant manager salary | 200,000 | 1,736,000 | ||||||
Gross profit | 1,656,000 | |||||||
Selling expenses | ||||||||
Sales commissions | 112,000 | |||||||
Packaging | 240,000 | |||||||
Advertising | 100,000 | 452,000 | ||||||
Administrative expenses | ||||||||
Administrative salaries | 250,000 | |||||||
Depreciationoffice equip. | 220,000 | |||||||
Insurance | 190,000 | |||||||
Office rent | 200,000 | 860,000 | ||||||
Income from operations | $ | 344,000 | ||||||
(1) Compute the total variable cost per unit.
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(2) Compute the total fixed costs.
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(3) Compute the income from operations for sales volume of 14,000 units.
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(4) Compute the income from operations for sales volume of 18,000 units.
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