E23-13 Fulz Company has accumulated the following budget data for the year 2017.

Question

E23-13 Fulz Company has accumulated the following budget data for the year 2017. ed income year 1. Sales: 30,000 units, unit selling price $85. 2. Cost of one unit of finished goods: direct materials 1 pound at $5 per pound, direct labor 3 hours at $15 per hour, and manufacturing overhead $5 per direct labor hour. 3. Inventories (raw materials only: beginning, 10,000 pounds; ending, 15,000 pounds. 4. Selling and administrative expenses: $170,000; interest expense: $30,000. 5. Income taxes: 30% of income before income taxes. Instructions (a) Prepare a schedule showing the computation of cost of goods sold for 2017. (b) Prepare a budgeted multiple-step income statement for 2017.

Explanation / Answer

a FULTZ COMPANY Computation of Cost of Goods Sold For the Year Ending December 31, 2017 Cost of one unit of finished goods: Direct materials (1 × $5) $5.00 Direct labor (3 × $15) $45.00 Manufacturing overhead (3 × $5) $15.00 Total $65.00 Units 30000 Total cost $1,950,000 b FULTZ COMPANY Budgeted Income Statement For the Year Ending December 31, 2017 Sales (30,000 x $85) $2,550,000 Cost of goods sold $1,950,000 Gross Profit $600,000 Selling and administrative expenses $170,000 Income before interest & income taxes $430,000 Interest expenses $30,000 Income before income taxes $400,000 Income tax expense $120,000 Net Income $280,000

Related Questions

Navigate

• Browse (All)
• Browse E
• Subjects

---

---

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