Answer:
Pro Forma Income Statement 30,000 units
Sales($90 * 30,000) $2,700,000
Minus Variable Costs $1,620,000
- Direct Material ($18 *30,000)=540,000
- Direct Labor ($9*30,000) =270,000
- Overhead cost(12.60*30,000)=378,000
- Selling and admin (14.40*30,000)=432,000
Contribution $1,080,000
minus Fixed Costs $378,000
- Manufacturing costs = 270,000
- Selling and admin cost = 108,000
Net Income $702,000
FLEXIBLE BUDGET INCOME STATEMENT
29,000 UNITS 31,000 UNITS
Sales $2,610,000 $2,790,000
Minus Variable costs $1,566,000 $1,674,000
Direct Material $522,000 $558,000
Direct labor $261,000 $279,000
Overhead cost $365,400 $390,600
Selling and Admin cost $417,600 $446,400
Contribution $1,044,000 $1,116,000
Minus Fixed Cost $378,000 $378,000
- Manufacturing cost $270,000 $270,000
- Selling and Admin cost $108,000 $108,000
Net Income $666,000 $738,000
Details 30,000 Units 31,000 Units Variance
Sales $2,700,000 $2,790,000 $90,000 F
Direct Material $540,000 $558,000 $18,000 U
Direct Labor $270,000 $279,000 $9,000 U
Overhead cost $378,000 $390,600 $12,000 U
Selling and Admin $432,000 $446,400 $14,400 U
Total $36,600 F
Explanation:
