Required information

Problem 21-1A Preparing and analyzing a flexible budget LO P1, A1

Skip to question

[The following information applies to the questions displayed below.] Phoenix Companys 2019 master budget included the following fixed budget report. It is based on an expected production and sales volume of 15,000 units.

PHOENIX COMPANY Fixed Budget Report For Year Ended December 31, 2019
Sales				$	3,150,000
Cost of goods sold
Direct materials	$	915,000
Direct labor		225,000
Machinery repairs (variable cost)		60,000
DepreciationPlant equipment (straight-line)		315,000
Utilities ($60,000 is variable)		180,000
Plant management salaries		190,000			1,885,000
Gross profit					1,265,000
Selling expenses
Packaging		75,000
Shipping		105,000
Sales salary (fixed annual amount)		235,000			415,000
General and administrative expenses
Advertising expense		125,000
Salaries		230,000
Entertainment expense		75,000			430,000
Income from operations				$	420,000

PHOENIX COMPANY Flexible Budgets For Year Ended December 31, 2019 Flexible Budget Variable Amount Total Variable Amount per Unit Sales Variable costs Direct materials Direct labor Machinery repairs Utilities Packaging Shipping Total variable costs Contribution margin Fixed costs Depreciation-Plant equipment (straight-line) Utilities Plant management salaries Sales salary Advertising expense Salaries Entertainment expense Total fixed costs Income from operations Flexible Budget for: Units Sales Unit Sales of 16,000 of 14,000 61.00 15.00 4.00 4.00 5.00 7.00 96.00 0 0 Entainmentexpense