WHITNEY COMPANY Income Statement For the Year Ended December 31 Sales (45,000 units at $10 per unit) ... Less cost of goods sold: $450,000 Direct materials $90,000 78,300 98,500 Direct labor Manufacturing overhead 266,800 Gross margin Less operating expenses: Selling expenses: Variable: 183,200 $27,000 5,400 Sales commissions Shipping 32,400 . .. Fixed (advertising, salaries) 120,000 Administrative: Variable (billing and other) Fixed (salaries and other) 1,800 48,000 202,200 Net operating loss $ (19,000)
WHITNEY COMPANY Income Statement For the Year Ended December 31 Sales (45,000 units at $10 per unit) ... Less cost of goods sold: $450,000 Direct materials $90,000 78,300 98,500 Direct labor Manufacturing overhead 266,800 Gross margin Less operating expenses: Selling expenses: Variable: 183,200 $27,000 5,400 Sales commissions Shipping 32,400 . .. Fixed (advertising, salaries) 120,000 Administrative: Variable (billing and other) Fixed (salaries and other) 1,800 48,000 202,200 Net operating loss $ (19,000)
Cornerstones of Cost Management (Cornerstones Series)
4th Edition
ISBN:9781305970663
Author:Don R. Hansen, Maryanne M. Mowen
Publisher:Don R. Hansen, Maryanne M. Mowen
Chapter2: Basic Cost Management Concepts
Section: Chapter Questions
Problem 22E: Ellerson Company provided the following information for the last calendar year: During the year,...
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Whitney Company's board of director believes that the company's problem lies in adequate promotion. By how much can advertising be increased and still allow the company to earn a target profit of 4.5% on slaes of 60,000 units?
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