Joseph Company has budgeted sales for the next three months as follows:
Budgeted Sales in Units
July: 7,105 units
August: 6,820 units
September: 8,345 units
Past experience has shown that the ending inventory for each month should be equal to 40% of the next month's expected sales in units. The company is currently preparing a production budget.
Calculate the total number of units budgeted to be produced in July.
2. Corrected_text: Foto Company manufactures and sells a product called JYMP. Results from last year from the sale of JYMP appear below:
Sales revenue: 8,000 JYMPs @ $120 each
Variable costs: $640,000
Contribution margin: $320,000
Fixed costs:
- Salaries of line supervisors: $160,000
- Advertising expense: $132,000
- Allocated general overhead: $100,000
Net loss: <$72,000>
Eoto Company is considering eliminating the JYMP product line. The company has determined that if the JYMP product line is discontinued, the contribution margin of its other products will increase by $120,000.
Calculate the amount by which the company's net income will increase if the JYMP product line is dropped.
Title_with_topic:
1. Budgeted Sales and Production Calculation
2. Analysis of JYMP Product Line's Impact on Net Income