+1(805) 568 7317

prepare budgeted financial statements cameron parts has the following data from year 691277

Prepare Budgeted Financial Statements

Cameron Parts has the following data from year 1 operations, which are to be used for developing year 2 budget estimates:

Revenues (12,500 units)

$ 1,119,000

Manufacturing costs



$ 199,500

Variable cash costs


Fixed cash costs


Depreciation (fixed)


Marketing and administrative costs


Marketing (variable, cash)


Marketing depreciation


Administrative (fixed, cash)


Administrative depreciation


Total costs


Operating profits

$ 82,485

All depreciation charges are fixed. Old manufacturing equipment with an annual depreciation charge of $14,550 will be replaced in year 2 with new equipment that will incur an annual depreciation charge of $21,000. Sales volume and prices are expected to increase by 12 percent and 6 percent, respectively. On a per unit basis, expectations are that materials costs will increase by 10 percent and variable manufacturing costs will decrease by 4 percent. Fixed manufacturing costs are expected to decrease by 7 percent.

Variable marketing costs will change with volume. Administrative cash costs are expected to increase by 8 percent. Inventories are kept at zero. Cameron operates on a cash basis.


Prepare a budgeted income statement for year 2.

"Order a similar paper and get 15% discount on your first order with us
Use the following coupon

Order Now