Smith and Sons is developing the 2011 budget. In 2011 the company would like to increase selling prices by 20% and as a result expects a decrease in sales volume of 10%. Cost of goods sold as a percentage of sales is expected to increase to 65%. Other than depreciation all operating costs are variable as a percentage of total sales. Prepare a budgeted income statement for 2011Additional RequirementsSales (100000 units) $400000/$100000 = $ 4 per unit $400000Less: cost of goods sold ($250000/$400000= 62.5%) 250000Gross profit (150000/250000 = .37.5) 150000Operating expenses (includes $10000 of depreciation)((110000 -10000)/100000 units = $1.00 per unit) 110000Net income (40000/400000 = 10%) $ 40000

  
error: Content is protected !!