Walton Company has provided the following 2018 data:
Budget | |||
Sales | $ | 505,000 | |
Variable product costs | 195,000 | ||
Variable selling expense | 45,000 | ||
Other variable expenses | 3,200 | ||
Fixed product costs | 16,500 | ||
Fixed selling expense | 23,900 | ||
Other fixed expenses | 1,700 | ||
Interest expense | 720 | ||
Variances | |||
Sales | 8,300 | U | |
Variable product costs | 4,900 | F | |
Variable selling expense | 1,500 | U | |
Other variable expenses | 1,100 | U | |
Fixed product costs | 270 | F | |
Fixed selling expense | 430 | F | |
Other fixed expenses | 170 | U | |
Interest expense | 150 | F | |
Required
a. & b. Prepare a budgeted and actual income statement for internal use. Separate operating income from net income in the statements. Calculate variances and identify them as favorable (F) or unfavorable (U) by comparing the budgeted and actual amounts determined. (Select "None" if there is no effect (i.e., zero variance).
Answer is not complete.
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WALTON COMPANY | ||||
INTERNAL INCOME STATEMENT FOR 2018 | ||||
BUDGET($) | ACTUAL($) | VARIENCE($) | ||
Sales | 505,000 | 496,700 | 8,300 | U |
variable Exp: | ||||
Product cost | 195,000 | 190,100 | 4,900 | F |
Selling Exp | 45,000 | 46,500 | 1,500 | U |
Other Exp | 3,200 | 4,300 | 1,100 | U |
Contribution Margin | 261,800 | 255,800 | 6,000 | U |
Fixed Exp: | ||||
Product cost | 16,500 | 16,230 | 270 | F |
Selling Exp | 23,900 | 23,470 | 430 | F |
Other Exp | 1,700 | 1870 | 170 | U |
Operating Income(loss) | 219,700 | 214,230 | 5,470 | U |
Interest Exp | 720 | 570 | 150 | F |
Net Income (Loss) | 218,980 | 213,660 | 5,320 | U |
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