Question

Question 32 Martin Footwear Co. produces high-quality shoes. To prepare for next year's marketing campaign, the company's controller has prepared the following information for the current year, 2020: Variable costs (per pair of shoes) Direct materials $40.00 Direct manufacturing labour 21.00 Variable overhead (manufacturing, marketing, distribution, customer 23.00 service, and administration) Total variable costs $84.00 Fixed costs Manufacturing Marketing, distribution, and customer service Administrative Total fixed costs $2,695,000 550,000 735,000 $3,980,000 Selling price per pair of shoes Expected revenues, 2020 (51,300 units) Income tax rate $184 $9,439,200 40% (a) x Your answer is incorrect. Try again. Calculate the projected operating income before tax for 2020. Operating income before tax 1098700

Answer 1

solution Statement showing Projected operating Income before tax 2020. Amount ($) 2,052,000 1,077,300 Particulars A variable Costi :- - Direct Material (51300 X $40) unit Direct mfg. labor (57,300 * $ 21) unit variable overhead (51₂ 300 x $23) o d Total variable cest B) Fixed Costs :- → Manufacturing - Marketing distribution and Customer service > Adminishative 1, 179,900 4, 309, 200 2,695,000 550,000 1735,000 Total fixed Cost (B) 3,980,000

Total Costs (Ato) 18, 289, 200 9,439,200 Expected sales avenue o operating Income before tax ( 91439,200 - 8, 289, 200) 1,150,000 Note! - It has been assument that there is no opening of closing Inventory and Hence, production unit (51,300) is equal to selling units ($1,300)