ultz company nas accumulated the rollowing budget data ror the year 201 1. Sales

Question

ultz company nas accumulated the rollowing budget data ror the year 201 1. Sales: 31,320 units, unit selling price $85. 2. hour. 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 $7 per direct labor 3. Inventories (raw materials only): beginning, 10,300 pounds; ending, 15,190 pounds. 4. Selng and administrative expenses: $170,000; interest expense: $30,000. Income taxes: 30% of income before income taxes. Your answer is correct. Prepare a schedule showing the computation of cost of goods sold for 2017 FULTZ COMPANY Computation of Cost of Goods Sold For the Year Ending December 31, 2017 Cost of one unit of finished goods: Direct materials Direct labor 36 Manufacturing overhead 21 Total 62 Cost of Goods Sold 1941840

Explanation / Answer

Budgeted income statement :

Sales (31320*85) 2662200 Less: Cost of goods sold (31320*62) -1941840 Gross profit 720360 Less:Selling and administrative expense -170000 Operating income 550360 Less; Interest expense -30000 Income before tax 520360 Less: Income tax -156108 Net income 364252

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