Relevant Information Skin Cream Bath Oil ...
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Accounting
| Relevant Information | |||||||||||
| Skin Cream | Bath Oil | Color Gel | |||||||||
| Budgeted sales in units (a) | 114,000 | 194,000 | 74,000 | ||||||||
| Expected sales price (b) | $ | 10 | $ | 7 | $ | 13 | |||||
| Variable costs per unit (c) | $ | 2 | $ | 2 | $ | 7 | |||||
| Income statements | |||||||||||
| Sales revenue (a b) | $ | 1,140,000 | $ | 1,358,000 | $ | 962,000 | |||||
| Variable costs (a c) | (228,000 | ) | (388,000 | ) | (518,000 | ) | |||||
| Contribution margin | 912,000 | 970,000 | 444,000 | ||||||||
| Fixed costs | (624,000 | ) | (650,000 | ) | (126,000 | ) | |||||
| Net income | $ | 288,000 | $ | 320,000 | $ | 318,000 | |||||
Required:
Prepare revised income statements for each product, assuming a 20 percent increase in the budgeted sales volume.
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