Question

Fultz Company has accumulated the following budget data for the year 2017.

1.		Sales: 31480 units, unit selling price $89.
2.		Cost of one unit of finished goods: direct materials 1 pound at $5 per pound, direct labor 3 hours at $12 per hour, and manufacturing overhead $6 per direct labor hour.
3.		Inventories (raw materials only): beginning, 10270 pounds; ending, 15380 pounds.
4.		Selling and administrative expenses: $170000; interest expense: $30000.
5.		Income taxes: 30% of income before income taxes.

Prepare a budgeted multiple-step income statement for 2017.

Answer 1

Budgeted multiple income statement

Sales (31480*89)	2801720
Cost of goods sold (31480*59)	1857320
Gross profit	944400
Selling and administrative expense	170000
Income from operation	774400
Other revenue and expense
Interest expense	30000
Income before tax	744400
Income tax	223320
Net income	521080