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28 November, 09:39

Preparing a Budgeted Income Statement Oliver Company provided the following information for the coming year: Units produced and sold 160,000 Cost of goods sold per unit $6.30 Selling price $11 Variable selling and administrative expenses per unit $1.10 Fixed selling and administrative expenses $423,000 Tax rate 18 % Required: Prepare a budgeted income statement for Oliver Company for the coming year. Round all income statement amounts to the nearest dollar. Oliver Company Budgeted Income Statement For the Coming Year Sales $

Cost of goods sold

Gross margin $

Less: Variable selling and administrative expenses

Less: Fixed selling and administrative expenses

Operating income $

Less: Income taxes

Net income $

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Answers (1)
  1. 28 November, 13:10
    0
    Instructions are listed below.

    Explanation:

    Giving the following information:

    Units produced and sold 160,000 Cost of goods sold per unit $6.30 Selling price $11

    Variable selling and administrative expenses per unit $1.10

    Fixed selling and administrative expenses $423,000

    Tax rate 18 %

    Income Statement:

    Sales = 160,000¨11 = 1,760,000

    COGS = 6.30*160,000 = (1,008,000)

    Gross profit = 752,000

    Selling and administrative expense = (160,000*1.10) + 423,000 = (599,000)

    Earning before taxes = 153,000

    Tax = 153,000*0.18 = (27,540)

    Net operating profit = 125,460
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