Reference no: EM131865735

Question - Cycle-1 is a fast-growing start-up firm that manufactures bicycles. The following income statement is available for October:

Sales revenue (300 units @ $600 per unit) $180,000
Less

Manufacturing costs

Variable costs 26,000

Depreciation (fixed) 27,540

Marketing and administrative costs

Fixed costs (cash) 67,500

Depreciation (fixed) 22,860

Total costs $143,900

Operating profits $36,100

Sales volume is expected to increase by 20 percent in November, but the sales price is expected to fall 10 percent. Variable manufacturing costs are expected to increase by 4 percent per unit in November. In addition to these cost changes, variable manufacturing costs also will change with sales volume. Marketing and administrative cash costs are expected to increase by 8 percent.

Cycle-1 operates on a cash basis and maintains no inventories. Depreciation is fixed and should remain unchanged over the next three years.

How would I make a budgeted income statement for November?