Question

Check my wc 6 Exercise 20-34 Budgeted income statement LO P3 Fortune, Inc., is preparing its master budget for the first quarter. The company sells a single product at a price of $25 per unit. Sales (in units) are forecasted at 38,000 for January, 58,000 for February, and 48,000 for March. C of goods sold is $12 per unit. Other expense information for the first quarter follows. points еВook Commissions 8% of sales dollars $21,000 per month of sales dollars Hint Rent Advertising 15% $ 74,000 $52,000 Office salaries Print per month Depreciation per month References 10% annually on a $240,000 note payable Interest 40% Tax rate Prepare a budgeted income statement for this first quarter. (Round your final answers to the nearest whole dollar.) INC FORTIINE 10

Answer 1

1 Answer: PAGE NO DATE Fortune Inc Budgeted Income statement for Quarter ended 31/03/... Sales: Jan feb Mar 35,000 x $25 = 9,50,000 58,000 X 825 = 14,50,000 40,000 x $25 = 12400,000 $ 3600,000 - Cast of Goods sold (144,000+ $12) ($ 17,28,000) $ 18,72,000 o operating Expenses Commission ( 36,00,000 X 8.1.) (2,88,000) Rent (21000 x 3m) ( 63000) Advertising (3600,000 X 15-0) (5,40,000) office salaries (74.000 * 3m) (2,22,000) Depreciation (521000 x 30) (156,000) Earnings before Interest & Tax (EBIT) $6,03,000 ( Interest (240,000 x107.739 ($6000) Earnings before Tax (EBT) $5,97,000 © Tax ( $597,000 X 401) ($ 2,38,800) $ 3,58,200 Earnings after Tax