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Tile Co. Income Statement Budget sales volume, unit: 3,000 Sales: 48,000 Variable product: 21,000 variable selling...

Tile Co. Income Statement Budget sales volume, unit: 3,000 Sales: 48,000 Variable product: 21,000 variable selling and admin: 10,500 contribution margin: 16,500 fixed product: 5,100 fixed variable selling and admin: 3,300 operating income: 8,100

Tile Co. is budgeting for next year. Their initial budget is shown above. If they wish to budget for 7,000 units, what would the new budgeted profit be? Enter as a whole number, no commas and no dollar signs.

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Answer #1

Number of units sold = 3,000

Sales = $48,000

Selling price per unit = Sales/Number of units sold

= 48,000/3,000

= $16

Variable product = $21,000

Variable product per unit = Variable product/Number of units sold

= 21,000/3,000

= $7

Variable selling and admin = $10,500

Variable selling and admin per unit =  Variable selling and admin/Number of units sold

= 10,500/3,000

= $3.5

Budgeted income statement

Sales (7,000 x 16) 112,000
Variable product (7,000 x 7) - 49,000
Variable selling and admin (7,000 x 3.5) - 24,500
Contribution margin 38,500
Fixed product - 5,100
Fixed selling and admin - 3,300
Budgeted profit 30100

Budgeted profit = 30100

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