Question

Tempo Company's fixed budget (based on sales of 12,000 units) for the first quarter of calendar year 2017 reveals the following. Fixed Budget $2,532,000 $288,000 528,000 336,000 88,000 1,240,000 1,292,000 Sales (12,000 units) Cost of goods sold Direct materials Direct labor Production supplies Plant manager salary Gross profit Selling expenses Sales commissions Packaging Advertising Administrative expenses Administrative salaries Depreciation-office equip. Insurance Office rent Income from operations 84,000 168,000 100,000 352,000 138,000 108,000 78,000 88,000 412,000 $ 528,000 Complete the following flexible budgets for sales volumes of 10,000, 12,000, and 14,000 units. (Round cost per unit to 2 decimal places.)

Answer 1

TEMPO COMPANY Fixed Budget Report For year Ended December 31, 2017 Flexible Budget Variable Amount per unit) Total Fixed Costs Units sales of 10000 211.00 2110000 Flexible Budget at Units sales of 12000 Unit sales of 14000 2532000 2954000 Sales Variable costs: Direct materials Direct labor Production supplies Sales Commissions Packaging 24.00 44.00 28.00 7.00 14.00 240000 440000 280000 70000 140000 288000 528000 336000 84000 168000 336000 616000 392000 98000 196000 117.00 94.00 1170000 940000 14040001 1128000 1638000 1316000 Total Variable costs Contribution margin Fixed costs: Plant management salary Advertising Administrative Salaries Depreciation office equipment Insurance Office rent 88000 100000 138000 108000 78000 88000 88000 100000 138000 108000 78000 88000 88000 100000 138000 1080001 78000 88000 88000 100000 138000 108000 78000 88000 600000 Total Fixed costs Income from operations 600000 340000 600000 528000 600000 716000