ezto.mheducation.com/hm.tpx Phoenix Company\'s 2015 master budget included the f

Question

ezto.mheducation.com/hm.tpx Phoenix Company's 2015 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, 2015 Sales 3,000,000 Cost of goods sold Direct materials Direct labor Machinery repairs (variable cost) S 945,000 225,000 45,000 equipment (stroight 330,000 line) Utilities ($45,000 is variable) Plant management salaries 180,000 190,000 1915,000 Gross profit Selling expenses 1085,000 Packaging Shipping 90,000 105,000 235,000 430.000 General ond administrative expenses Advertising expense Salaries Entertainment expense 125,000 230000 80,000 435.000 income from operations S 220.000 O Type here to search 0

Explanation / Answer

Answer 1 & 2. PHOENIX COMPANY Fixed Budget Report For Year Ended Dec 31, 2015 Flexible Budget Flexible Budget For Variable Amt. Per Unit Total Fixed Cost Unit Sales of 14,000 Unit Sales of 16,000 Sales                200.00    2,800,000.00    3,200,000.00 Variable Cost: Direct Materials                  63.00        882,000.00    1,008,000.00 Direct Labor                  15.00        210,000.00        240,000.00 Machinery Repairs                     3.00          42,000.00          48,000.00 Utilities                     3.00          42,000.00          48,000.00 Packaging                     6.00          84,000.00          96,000.00 Shipping                     7.00          98,000.00        112,000.00 Total Variable Cost                  97.00    1,358,000.00    1,552,000.00 Contribution                103.00    1,442,000.00    1,648,000.00 Fixed Cost Depreciation - Plant Equipment        330,000.00        330,000.00        330,000.00 Utilities        135,000.00        135,000.00        135,000.00 Plant Management Salaries        190,000.00        190,000.00        190,000.00 Sales Salary        235,000.00        235,000.00        235,000.00 Advertising Expense        125,000.00        125,000.00        125,000.00 Salaries        230,000.00        230,000.00        230,000.00 Entertainment Expense          80,000.00          80,000.00          80,000.00 Total Fixed Cost    1,325,000.00    1,325,000.00    1,325,000.00 Income From Operations        117,000.00        323,000.00 Answer 3. PHOENIX COMPANY Forecasted Contribution Margin Income Statement For the Year Ended Dec 31, 2015 Units Sold 15,000 Units Sold 18,000 Diference Sales In Units          15,000.00          18,000.00 Contribution Margin (Per Unit)                103.00                103.00 Contribution Margin    1,545,000.00    1,854,000.00        309,000.00 Fixed Cost    1,325,000.00    1,325,000.00                         -   Expected Increase in Operating Income        309,000.00 Answer 4. PHOENIX COMPANY Forecasted Contribution Margin Income Statement For the Year Ended Dec 31, 2015 Units Sold 15,000 Units Sold 12,000 Diference Sales In Units          15,000.00          12,000.00 Contribution Margin (Per Unit)                103.00                103.00 Contribution Margin    1,545,000.00    1,236,000.00     (309,000.00) Fixed Cost    1,325,000.00    1,325,000.00                         -   Operating Income (Loss)        220,000.00        (89,000.00)     (309,000.00)

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