Calgary Industries is preparing a budgeted income statement for 2015 and hs accu

Question

Calgary Industries is preparing a budgeted income statement for 2015 and hs accumulated the following information. Predicted sales for the year are $730,000 and cost of goods sold is 40% of sales. The expected selling expenses are $81,000 and the expected general and administrative expenses are $90,000, which includes 52s or 2015 depreciation. The companies income tax rate is 30%. The budgeted net income 2 ahn S23,000 of A. $438,000. B. S186,900. C. $267,000. D. $84,700. E. $80,100. 39. Flagstaff units of 7,900 for July and 8,100 for August Company has budgeted production unit is 0.50 hours. Labor is paid at the rate of $21 per The direct labor requirement per hour. The total cost of direct labor for the month of August is: A. $82,950. B. $4,050. C. $85,050 D. $3,950 E. S168,000. 40. Manufacturing costs are generally classified into which of the following categories? A. Relevant costs and irrelevant costs B. Direct materials, direct labor, and manufacturing overhead C. Prime costs and conversion costs D. Conversion costs, marketing costs and administrative costs 16

Explanation / Answer

Answer to question 38

Net profit = profit before tax - tax expenses

=186900(option b is correct)

ANSWER to the question 39

Total labor cost=4050*21=85050

Option c is correct.

Answer to question 40

Option b is correct.

Manufacturing cost are generally divided or classified into three categories namely the direct materials, direct Labour and manufacturing overhead.

Particular amount Sales 730000 Cost of goods sold @(40%of 730000) 292000 Contribution 438000 Less other expensese(81000+90000) 171000 Profit before tax 267000 Tax expenses @30% of 347000 80100

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