Wolsey Industries Inc expects to maintain the same inventories at the end of 201

Question

Wolsey Industries Inc expects to maintain the same inventories at the end of 2014 as at the beginning of the year. The total of all production cost for the year is therefore assumed to be equal to the cost of goods sold. With this in mind, the various department heads were asked to submit estimates of the cost of goods sold. With this in mind, the various department heads were asked to submit estimates of the cost for their departments during 2014. A summary report for these estimates is as follows:

It is expected that $21,875 units will be sold at a price of $160 a unit. Maximum sales within the relevant range are 27,000 units.

Prepare an estimated income statement for 2014.

Explanation / Answer

Answer:

Income Statement Particulars Amount ($) Sales 3500000 Less: Variable cost Direct Material 1006250 Direct Labor 875000 Factory overhead 437500 Sales salaries and comm. 175000 Miscellaneous selling exp 21875 Supplies 87500 Miscellaneous administrative exp 21875 Contribution income 875000 Less: Fixed Cost Factory overhead 200000 Sales salaries and comm. 110000 Advertising 40000 Travel 12000 Miscellaneous Selling exp 7600 Office and officer's salaries 132000 Supplies 10000 Miscellaneous administrative exp 13400 Net income 350000

Related Questions

Navigate

• Browse (All)
• Browse W
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.