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lutik1710 [3]
3 years ago
11

Butler Company developed a static budget at the beginning of the company's accounting period based on an expected volume of 6,00

0 units: Per unit Revenue $8.00 Variable costs 2.50 Contribution margin $5.50 Fixed costs 3.00 Net income $2.50 If actual production totals 7,000 units which is within the relevant range, the flexible budget would show fixed costs of:
Business
1 answer:
scoundrel [369]3 years ago
6 0

Answer:

$ 18,000

Explanation:

Given:

Revenue = $8.00 / unit

Variable costs = 2.50 / unit

Contribution margin = $5.50 / unit

Fixed costs = 3.00 / unit

Net income = $2.50 / unit

now,

the fixed cost remains same for the prescribed range and also the fixed cost does not vary with the volume if within the prescribed range,.

Thus,

fixed cost for 7,000 units will be same as the fixed cost for the 6,000 units

therefore,

Fixed cost = 3.00 × 6,000 = $ 18,000

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Because they are always converted to an income summary throughout the closing process, revenue and expense accounts are known as nominal accounts.

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Revenue Definition:

Revenue in financial accounting refers to an inflow of funds, typically from sales or services provided by commercial activity. It is also known as sales or business turnover. In other terms, revenue refers to the amount of money that a company or organization receives. For instance, certain businesses may receive income from royalties, interest, or copyright fees. While for some businesses, money may come from the services they provide to clients. Donations from groups, corporations, and people are referred to as revenue for non-profit organizations.

Operating Revenue Examples:

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Expenses Definition:

A money outflow is known as an expense or expenditure in financial accounting. As an illustration, a tenant's expenses can include rent. Parents' expenses could include the cost of their children's tuition. Expenses for a business include things like electricity bills, bank fees, sales expenses, phone bills, repairs, and services.

List of expenses in accounts frequently observed when preparing financial statements:

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Learn more about Revenue and expense accounts here

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3 0
1 year ago
MARK AS BRAINLY//
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Answer:

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2 years ago
A freezer manufacturer might purchase sheets of steel, wiring, shelving, and so forth, as part of its final product. This is an
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