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this is a two part question! the first part i need the answer for variable cash cost and operating profit The following information is available
this is a two part question! the first part i need the answer for variable cash cost and operating profit
The following information is available for Fairmount Industries from year 1 operations: All depreciation charges are fixed. Old manufacturing equipment with an annual depreciation charge of $42,000 will be fully depreciated by the end of year 1 and will not be replaced with new equipment because it is still operating to specification. Sales volume is expected to decrease by 2 percent. Sales price is expected to increase by 8 percent. On a per-unit basis, expectations are that materials costs will decrease by 5 percent and variable manufacturing cash costs will increase by 4 percent. Fixed cash manufacturing costs are expected to increase by 12 percent. Variable marketing costs will change with volume. Administrative cash costs are expected to decrease by 15 percent Inventories are kept at zero. Fairmount Industries operates on a cash basis. No change is expected in marketing or administrative depreciation Fairmount Industries Budgeted Income Statement For Year 2 Required: Estimate the cash from operations expected in year 2 . Note: Do not round intermediate calculations. Round your final answers to the nearest whole dollar amounts Step by Step Solution
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