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In: Accounting

Tempo Company's fixed budget (based on sales of 18,000 units) for the first quarter reveals the...

Tempo Company's fixed budget (based on sales of 18,000 units) for the first quarter reveals the following.

Fixed Budget
Sales (18,000 units × $208 per unit) $ 3,744,000
Cost of goods sold
Direct materials $ 414,000
Direct labor 756,000
Production supplies 468,000
Plant manager salary 214,000 1,852,000
Gross profit 1,892,000
Selling expenses
Sales commissions 126,000
Packaging 270,000
Advertising 100,000 496,000
Administrative expenses
Administrative salaries 264,000
Depreciation—office equip. 234,000
Insurance 204,000
Office rent 214,000 916,000
Income from operations $ 480,000


(1) Compute the total variable cost per unit.
(2) Compute the total fixed costs.
(3) Compute the income from operations for sales volume of 16,000 units.
(4) Compute the income from operations for sales volume of 20,000 units.

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Expert Solution

ekkarill92 answered 2 years ago
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