Deleon Inc. is preparing its annual budgets for the year ending December 31, 201

Question

Deleon Inc. is preparing its annual budgets for the year ending December 31, 2017. Accounting assistants furnish the data shown below Product Product JB 50 JB 60 Sales budget Anticipated volume in units Unit selling price 400,000 200,000 $20 $25 Production budget: 15,000 Desired ending finished goods units Beginning finished goods units 30,000 25,000 10,000 Direct materials budget: Direct materials per unit (pounds) Desired ending direct materials pounds Beginning direct materials pounds Cost per pound 30,000 40,000 $3 10,000 15,000 Direct labor budget: Direct labor time per unit Direct labor rate per hour Budgeted income statement 0.6 $12 $12 Total unit cost $13 $20 An accounting assistant has prepared the detailed manufacturing overhead budget and the selling and administrative expense budget. The latter shows selling expenses of $560,000 for product JB 50 and $360,000 for product JB 60, and administrative expenses of $540,000 for product JB 50 and $340,000 for product JB 60. Interest expense is $150,000 (not allocated to products). Income taxes are expected to be 30%

Explanation / Answer

All other Parts are already solved: DELEON INC. Budgeted Income Statement For the year ended Dec 31, 2017 Explanation JB 50 JB 60 Total JB 50 JB 60 Sales 8000000 5000000 13000000 Sales Budget Sales Budget Less: Manufacturing Cost 5200000 4000000 9200000 Unit Sold*Unit Cost Unit Sold*Unit Cost Gross Profit/Margin 2800000 1000000 3800000 Sales-M Cost Sales-M Cost Operating Costs: Selling Expense 560000 360000 920000 Given Given Administrative Expense 540000 340000 880000 Given Given Total Operating Cost 1100000 700000 1800000 Total Total Operating Income 1700000 300000 2000000 Gross Margin-Operating Cost Gross Margin-Operating Cost Less: Interest Expense 150000 Income Before Taxes 1850000 Less: Income Taxes 555000 (30% of Income Before taxes) Income After Tax 1295000 Working Note: JB 50 JB 60 Units 400000 200000 JB 50 JB 60 Direct Material PU 2.00 3.00 Rate Per Pound 3.00 4.00 Direct Material Cost 6.00 12.00 JB 50 JB 60 Direct Labor PU 0.40 0.60 Rate Per Pound 12.00 12.00 Direct Material Cost 4.80 7.20 Total Variable Cost 10.80 19.20 (DM+DL) Unit Cost Given 13 20 Manuafcturing OH 2.20 0.80

Related Questions

Navigate

• Browse (All)
• Browse D
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.