Allen Manufacturing makes staplers. The budgeted selling price is $15 per stapler, the variable costs are $4 per stapler, and the budgeted fixed costs are $14,000. What is the budgeted operating income for 4,000 staplers?
In the context of accounting, the budgeting activity is usually carried out for the forthcoming year to keep a track of metrics such as expenses, revenues, income, and cash flows. One can even calculate the variances by comparing the budgeted values with the actual values.
Answer and Explanation: 1
The correct answer is option A) $30,000.
The budgeted contribution margin per unit is given by:
- = Budgeted selling price per unit - variable cost...
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fromChapter 11 / Lesson 10
Learn about budged income statements. Discover the benefits of this accounting approach, and study how to make a budgeted income statement with an example.