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Phoenix Company's 2017 master budget included the following fixed budget report. It is based on an expected production and sales olume of 15,000 units PHOENIX COMPANY Fixed Budget Report For Year Ended December 31, 2017 Sales Cost of goods sold $ 3,000,000 Direct materials Direct labor Machinery repairs (variable cost) Depreciation-Plant equipment (straight-line) Utilities ($45,000 is variable) Plant management salaries $975,000 225,00e 60,000 300,00e 195,008 200,000 1,955,000 1,045,000 Gross profit Selling expenses Packaging Shipping Sales salary (fixed annual amount) 75,000 105,000 250,006 430,000 General and administrative expenses Advertising expense Salaries Entertainment expense 125,000 241,000 90,0005b,99e 456,000 Income from operations $ 159,000 Phoenix Company's actual income statement for 2017 follows PHOENIX COMPANY Statement of Income from Operations For Year Ended December 31, 2017 Sales (18,000 units) Cost of goods sold $ 3,648,000 Direct materials Direct labor Machinery repairs (variable cost) Depreciation-Plant equipment (straight-line) Utilities (fixed cost is $147,500) Plant management salaries $1,185,000 278,000 63,000 300,00e 200,500 210,000 2,236,500 1,411,500 Gross profit Selling expenses Packaging Shipping Sales salary (annual) 87,500 118,500 268,000 474,000 General and administrative expenses Advertising expense Salaries Entertainment expense 132,000 241,00e 93,500 466,500 $. 471,000 Income from operations

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