Income statement for internal use
Ladmilla Company has provided the following 2011 data.
Budget |
|
Sales | $500,000 |
Variable product costs | 204,000 |
Variable selling expenses | 50,000 |
Other variable expenses | 3,600 |
Fixed product costs | 16,600 |
Fixed selling expenses | 24,300 |
Other fixed expenses | 2,200 |
Interest expense | 800 |
Variances |
|
Sales | 8,600 U |
Variable product costs | 4,000 F |
Variable selling expenses | 2,500 U |
Other variable expenses | 1,200 U |
Fixed product costs | 220 F |
Fixed selling expenses | 390 F |
Other fixed expenses | 150 U |
Interest expense | 80 F |
Required
a. Prepare in good form a budgeted and actual income statement for internal use. Separate operating income from net income in the statements.
b. Calculate variances and identify these as favorable (F) or unfavorable (U).
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