Alphonse Company manufactures staplers. The budgeted sales price is $14.00 per stapler, the variable costs are $3.00 per stapler, and budgeted fixed costs are $12,000. What is the budgeted operating income for 4200 staplers

$34200

Explanation:

Given: The budgeted sales price= $14 per stapler

           The variable cost= $3 per stapler.

           Budgeted fixed cost= $12000.

           Total number of stapler= 4200.

First finding the total revenue earned by Alphonse company, if they sell 4200 staplers.

Total revenue=

⇒ Total revenue=

∴ Total revenue= $58800

Now, calculating total cost of manufacturing stapler.

Total cost=

Total cost=

⇒ Total cost=

∴ Total cost=

Next computing the budgeted operating income.

Operating income=

⇒ Operating income=

∴ Operating income=  

Hence, $34200 is the budgeted operating income for 4200 staplers.

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