Question

North Company has completed all of its operating budgets. The sales budget for the year shows 50,950 units and total sales of $2,429,400. The total unit cost of making one unit of sales is $22. Selling and administrative expenses are expected to be $308,700. Interest is estimated to be $12,720. Income taxes are estimated to be $220,600. Prepare a budgeted multiple-step income statement for the year ending December 31, 2020. NORTH COMPANY Budgeted Income Statement

Answer 1

Answer:

Net income/(loss) = $766,480

Explanation:

As per the data given in the question,

Budgeted income statement

Sales = $2,429,400

Less: COG sold = $1,120,900 (50,950×$22)

Gross Profit = $1,308,500

Less: Selling and admin. expense = $308,700

Income from operations = $999,800

Less: Interest expense = $12,720

Earning before income taxes = $987,080

Less: Income tax expense = $220,600

Net income/(loss) = $766,480