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Seattle Cat is the wholesale distributor of a small recreational catamaran sailboat Management has prepared the following summary data to use in its annual budgeting process

Seattle Cat is the wholesale distributor of a small recreational catamaran sailboat. Management has prepared the following summary data to use in its annual budgeting process:

 
  Budgeted unit sales 380
  Selling price per unit $ 1,850
  Cost per unit $ 1,425
  Variable selling and administrative expenses (per unit) $ 85
  Fixed selling and administrative expenses (per year) $ 105,000
  Interest expense for the year $ 11,000
 
Required:

Prepare the companyAc€?cs budgeted income statement using an absorption income statement format shown below.

Seattle Cat

Budgeted Income Statement

Sales: $2,000,000

Cost of goods sold: $1,300,000

Gross margin: $700,000

Selling and administrative expenses: $576,000

Net operating income: $124,000

Interest expense: $21,900

Net income: $102,100

Jun 22 2020 View more View Less

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