Question

3 Gig Harbor Boating is the wholesale distributor of a small recreational catamaran sa summary data to use in its annual budgeting process: Budgeted unit sales Selling price per unit 780 2,110 1,615 55 Cost per unit Variable selling and administrative expense (per unit) Fixed selling and administrative expense (per year) Interest expense for the year $300,000 $ 27,000 Required: Prepare the company's budgeted income statement for the year. Gig Harbor Boating Budgeted Income Statement Sales $ 1.645,800 Cost of goods sold Gross margin 386,100 Selling and administrative expenses Net operating income Interest expense Net income

Answer 1

Answer-

GIB HARBOR BOATING
BUDGETED INCOME STATEMENT
PARTICULARS		AMOUNT
		$
Sales	780 units*$2110 per unit	1645800
Less- Cost of goods sold	780 units*$1615 per unit	1259700
Gross margin		386100
Less- Selling & administrative expense
Variable	780 units*$55 per unit	42900
Fixed		300000
Net operating income		43200
Less- Interest expense		27000
Net Income		16200