Question

Gig Harbor Boating is the wholesale distributor of a small recreational catamaran sailboat. Management has prepared the foll summary data to use in its annual budgeting process: points $ $ 680 2,060 1,680 Skipped Budgeted unit sales Selling price per unit Cost per unit Variable selling and administrative expense (per unit) Fixed selling and administrative expense (per year) Interest expense for the year $ 200,000 $ 22,000 eBook Hint Required: Prepare the company's budgeted income statement for the year Rotorences Gig Harbor Boating Budgeted Income Statement

Answer 1

Solution

Gig Harbor Boating
Budgeted Income Statement
Sales revenue	$ 1,400,800.00
Cost of goods sold	$ 1,142,400.00
Gross profit	$      258,400.00
Selling and Administrative expenses	$      234,000.00
Operating income	$        24,400.00
Interest expense	$        22,000.00
Net income	$          2,400.00

Working

Budgeted Income Statement
Sales revenue	=680*2060
Cost of goods sold	=680*1680