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Exercise 8-2 Preparing flexible budgets LO P1 Tempo Company's fixed budget (based on sales of 12,000...

Exercise 8-2 Preparing flexible budgets LO P1

Tempo Company's fixed budget (based on sales of 12,000 units) for the first quarter of calendar year 2017 reveals the following.

Fixed Budget
Sales (12,000 units) $ 2,604,000
Cost of goods sold
Direct materials $ 300,000
Direct labor 516,000
Production supplies 324,000
Plant manager salary 100,000 1,240,000
Gross profit 1,364,000
Selling expenses
Sales commissions 96,000
Packaging 168,000
Advertising 100,000 364,000
Administrative expenses
Administrative salaries 150,000
Depreciation—office equip. 120,000
Insurance 90,000
Office rent 100,000 460,000
Income from operations $ 540,000


Complete the following flexible budgets for sales volumes of 10,000, 12,000, and 14,000 units. (Round cost per unit to 2 decimal places.)

TEMPO COMPANY
Flexible Budgets
For Quarter Ended March 31, 2017
------Flexible Budget------ ------Flexible Budget at ------
Variable Amount per Unit Total Fixed Cost 10,000 units 12,000 units 14,000 units
Variable costs:
0.00 0 0 0
Fixed costs:
0 0 0 0

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Expert Solution

ekkarill92 answered 3 months ago
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