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Home Q & A Board Other Fields Homework Help Business Accounting
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jerico jerico
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9 years ago
Allscott Company is developing its budgets for 2016 and, for the first time, will use the kaizen approach. The initial 2016 income statement, based on static data from 2015, is as follows:

   Sales (140,000 units)   $420,000
   Less: Cost of goods sold   280,000

   Gross margin   140,000
   Operating expenses (includes $28,000 of depreciation)   112,000

   Net income   $28,000

Selling prices for 2016 are expected to increase by 8%, and sales volume in units will decrease by 10%. The cost of goods sold as estimated by the kaizen approach will decline by 10% per unit. Other than depreciation, all other operating costs are expected to decline by 5%.

Required:
Prepare a kaizen-based budgeted income statement for 2016.
Textbook 
Cost Accounting

Cost Accounting


Edition: 14th
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cyborgcyborg
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9 years ago
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jerico Author
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#2
9 years ago
Thank you for the help. I took this course as an elective, glad it's over in three weeks. Great textbook though!
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#3
9 years ago
Cool! No problem.
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