Question

Cycle-1 is a fast-growing start-up firm that manufactures bicycles. The following income statement is available for...

Cycle-1 is a fast-growing start-up firm that manufactures bicycles. The following income statement is available for October:

Sales revenue (320 units @ $720 per unit) $ 230,400
Less
Manufacturing costs
Variable costs 28,000
Depreciation (fixed) 26,200
Marketing and administrative costs
Fixed costs (cash) 66,800
Depreciation (fixed) 24,700
Total costs $ 145,700
Operating profits $ 84,700

Sales volume is expected to increase by 20 percent in November, but the sales price is expected to fall 5 percent. Variable manufacturing costs are expected to increase by 2 percent per unit in November. In addition to these cost changes, variable manufacturing costs also will change with sales volume. Marketing and administrative cash costs are expected to increase by 5 percent.

Cycle-1 operates on a cash basis and maintains no inventories. Depreciation is fixed and should remain unchanged over the next three years.

Required:

Prepare a budgeted income statement for November. (Do not round intermediate calculations.)

Please show work

Business   Accounting   
0 0
Add a commentTranscribed image text
Next >

Homework Answers

Answer #1

0 0
Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Log In

Sign Up

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
Cycle-1 is a fast-growing start-up firm that manufactures bicycles. The following income statement is available for...
Cycle-1 is a fast-growing start-up firm that manufactures bicycles. The following income statement is available for October: Sales revenue (480 units @ $660 per unit) $ 316,800 Less Manufacturing costs Variable costs 23,000 Depreciation (fixed) 27,400 Marketing and administrative costs Fixed costs (cash) 66,400 Depreciation (fixed) 23,700 Total costs $ 140,500 Operating profits $ 176,300 Sales volume is expected to increase by 20 percent in November, but the sales price is expected to fall 10 percent. Variable manufacturing costs are...
The following information is available for year 1 for Pepper Products:    Sales revenue (190,000 units)...
The following information is available for year 1 for Pepper Products:    Sales revenue (190,000 units) $ 3,800,000 Manufacturing costs Materials $ 224,000 Variable cash costs 190,000 Fixed cash costs 438,000 Depreciation (fixed) 1,336,000 Marketing and administrative costs Marketing (variable, cash) 565,000 Marketing depreciation 201,000 Administrative (fixed, cash) 684,000 Administrative depreciation 100,000 Total costs $ 3,738,000 Operating profits $ 62,000     All depreciation charges are fixed and are expected to remain the same for year 2. Sales volume is expected...
The following information is available for year 1 for Dancer Components: Sales revenue (220,000 units) $...
The following information is available for year 1 for Dancer Components: Sales revenue (220,000 units) $ 6,160,000 Manufacturing cost Materials $ 363,000 Variable cash cost 308,000 Fixed cash cost 708,000 Depreciation (fixed) 2,159,000 Marketing and administrative costs Marketing (variable, cash) 913,000 Marketing depreciation 323,000 Administrative (fixed, cash) 1,099,000 Administrative depreciation 161,000 Total costs $ 6,034,000 Operating profit $ 126,000 Variable marketing costs to change with unit volume. Administrative cash cost is expected to increase by 3 percent. Inventories will be...
The following information is available for year 1 for Pepper Products:    Sales revenue (260,000 units)...
The following information is available for year 1 for Pepper Products:    Sales revenue (260,000 units) $ 7,020,000 Manufacturing costs Materials $ 413,000 Variable cash costs 351,000 Fixed cash costs 808,000 Depreciation (fixed) 2,464,000 Marketing and administrative costs Marketing (variable, cash) 1,041,000 Marketing depreciation 369,000 Administrative (fixed, cash) 1,255,000 Administrative depreciation 185,000 Total costs $ 6,886,000 Operating profits $ 134,000     All depreciation charges are fixed and are expected to remain the same for year 2. Sales volume is expected...
The following information is available for year 1 for Dancer Components: Sales revenues (210,000 units) $...
The following information is available for year 1 for Dancer Components: Sales revenues (210,000 units) $ 3,150,000 Manufacturing costs Materials $ 167,000 Variable cash costs 150,300 Fixed cash costs 322,500 Depreciation 994,000 Marketing and administrative costs Marketing (variable, cash) 426,800 Marketing depreciation 143,800 Administrative (fixed, cash) 518,600 Administrative depreciation 77,100 Total costs $ 2,800,100 Operating profits $ 349,900 All depreciation charges are fixed and are expected to remain the same for year 2. Sales volume is expected to increase by...
The following information is available for 2018 for XYZ Products:                         Revenue (300,000 units)    &n
The following information is available for 2018 for XYZ Products:                         Revenue (300,000 units)                                           $2,400,000                         Manufacturing costs:                                                                Materials                                                                       400,000                         Variable overhead cash costs                                         270,000                         Fixed overhead cash costs                                             150,000                         Depreciation                                                                   500,000                         Marketing and administrative costs:                                                          Marketing variable costs                                                300,000                         Marketing depreciation                                                    50,000                         Administrative cash costs                                              200,000                         Administrative depreciation                                            30,000                         Total costs                                                                 $1,900,000                         Operating profits                                                         $ 500,000...
[The following information applies to the questions displayed below.] Gulf States Manufacturing has the following data...
[The following information applies to the questions displayed below.] Gulf States Manufacturing has the following data from year 1 operations, which are to be used for developing year 2 budget estimates: Sales revenues (21,500 units) $ 1,935,000 Manufacturing costs Materials $ 345,000 Variable cash costs 471,000 Fixed cash costs 189,000 Depreciation (fixed) 233,000 Marketing and administrative costs Marketing (variable, cash) 244,000 Marketing depreciation 59,000 Administrative (fixed, cash) 236,000 Administrative depreciation $ 21,000 Total costs $ 1,798,000 Operating profits $ 137,000...
The Westwood Cycle Company expects to start operations on July 1, 2020 and will sell bicycles...
The Westwood Cycle Company expects to start operations on July 1, 2020 and will sell bicycles out of its store that it recently leased in the town center. Westwood Cycle has budgeted sales for the month of July to be $12,000 of which 30 percent will be cash sales and 70 percent will be sales on account. Westwood Cycle expects a 15 percent increase in sales per month for August and September with the ratio of cash sales to sales...
The Regal Cycle Company manufactures three types of bicycles—a dirt bike, a mountain bike, and a...
The Regal Cycle Company manufactures three types of bicycles—a dirt bike, a mountain bike, and a racing bike. Data on sales and expenses for the past quarter follow: Total Dirt Bikes Mountain Bikes Racing Bikes   Sales $ 924,000 $ 267,000 $ 401,000   $ 256,000     Variable manufacturing and selling expenses 468,000 118,000 199,000   151,000     Contribution margin 456,000 149,000 202,000 105,000     Fixed expenses:     Advertising, traceable 69,900 8,900 40,400 20,600     Depreciation of special equipment 43,100 20,400 7,500 15,200       Salaries of product-line managers 114,800...
A manufacturing company gross margin income statement refers to sales revenue minus: variable costs, excluding variable...
A manufacturing company gross margin income statement refers to sales revenue minus: variable costs, excluding variable marketing and administrative costs. all variable costs, including variable marketing and administrative costs. cost of goods sold, excluding fixed indirect manufacturing costs. cost of goods sold, including fixed indirect manufacturing costs. Fixed costs are different than variable costs because (CMA adapted) Total variable costs are variable over the relevant range but fixed in the long-term, while fixed costs never change. Unit variable costs fluctuate...
ADVERTISEMENT
Need Online Homework Help?

Get Answers For Free
Most questions answered within 1 hours.

Ask a Question
ADVERTISEMENT