Flexible budget for selling and administrative expenses for a service company Digital Solutions Inc. uses flexible budgets that are based on the following data: Sales commissions Advertising expense Miscellaneous administrative expense Office salaries expense Customer support expenses 8% of sales 15% of sales $10,000 per month plus 4% of sales $50,000 per month $20,000 per month plus 30% of sales Research and development expense $75,000 per month Prepare a flexible selling and administrative expenses budget for October for sales volumes of $500,000, $750,000, and $1,000,000. (Use Exhibit 4 as a model.) Flexible Selling and Administrative Expenses Budget Digital Solutions Inc. For the Month Ending October 31 Amount $500,000 Amount $750,000 Amount $1,000,000 Line Item Description Total sales Variable cost: Sales commissions 40,000 60,000 80,000 Advertising expense 75,000 112,500 150,000

Flexible budget for selling and administrative expenses for a service company Digital Solutions Inc. uses flexible budgets that are based on the following data: Sales commissions Advertising expense Miscellaneous administrative expense Office salaries expense Customer support expenses 8% of sales 15% of sales $10,000 per month plus 4% of sales $50,000 per month $20,000 per month plus 30% of sales Research and development expense $75,000 per month Prepare a flexible selling and administrative expenses budget for October for sales volumes of $500,000, $750,000, and $1,000,000. (Use Exhibit 4 as a model.) Flexible Selling and Administrative Expenses Budget Digital Solutions Inc. For the Month Ending October 31 Amount $500,000 Amount $750,000 Amount $1,000,000 Line Item Description Total sales Variable cost: Sales commissions 40,000 60,000 80,000 Advertising expense 75,000 112,500 150,000

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Flexible Budget for Selling and Administrative Expenses for a Service Company Digital Solutions Inc. uses flexible budgets that are based on the following data: Sales commissions 15% of sales Advertising expense 18% of sales Miscellaneous administrative expense $9,000 per month plus 12% of sales Office salaries expense $29,000 per month Customer support expenses $12,000 per month plus 20% of sales Research and development expense $32,000 per month Prepare a flexible selling and administrative expenses budget for October for sales volumes of $400,000, $500,000, and $600,000. (Use Exhibit 5 as a model.) Digital Solutions Inc. Flexible Selling and Administrative Expenses Budget For the Month Ending October 31 Total sales $400,000 $500,000 $600,000 Variable cost: $ $ $ Total variable cost $ $ $ Fixed cost: $ $ $ Total fixed cost $ $ $ Total selling and administrative…
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X-Tel budgets sales of $52.000 for April, $92,000 for May, and $64,000 for June. Sales commissions are 10% of sales dollars and the company pays a sales manager a salary of $5,200 per month Sales commissions and salaries are paid in the month incurred. Prepare a selling expense budget for April, May, and June. X-TEL Selling Expense Budget April May Budgeted sales Sales commissions
Flexible Budget for Selling and Administrative Expenses for a Service Company Morningside Technologies Inc. uses flexible budgets that are based on the following data: Sales commissions 6% of sales Advertising expense 20% of sales Miscellaneous administrative expense $1,700 per month plus 1% of sales Office salaries expense $16,000 per month Customer support expenses $2,350 plus 2% of sales Research and development expense 3,150 per month Prepare a flexible selling and administrative expenses budget for April for sales volumes of $105,000, $130,000, and $160,000. Enter all amounts as positive numbers. Morningside Technologies Inc.Flexible Selling and Administrative Expenses BudgetFor the Month Ending April 30 Total sales $105,000 $130,000 $160,000 Variable cost: Sales commissions $fill in the blank 1 $fill in the blank 2 $fill in the blank 3 Advertising expense fill in the blank 4 fill in the blank 5 fill in the blank 6 Miscellaneous administrative…
( ces Nina Company prepared the following fixed budget for July using 7.780 units for budgeted sales. Actual sales were 7.480 units and actual costs are shown below. For Month Ended July 31 Sales Variable costs Direct materials Direct labor Indirect materials Sales commissions Total variable costs Contribution margin Fixed costs Depreciation Machinery Supervisor salary Insurance Depreciation-Office equipment Administrative salaries i Total fixed costa Income For Month Ended July 31 Sales Variable costs Direct matanals Direct labor indirect materials Sales commissions Total Variable Costs Contribution margin Find costs Depreciation Machinery Supervisory salary Insurance Depreciation Offenequere Administrative salaries Total Fed Costs Fixed Budget Incue Variable Amount per Total Fixed Unit Cost $ 100 |===== $ 70,860 42,040 10,420 7,680 31,900 $164,900 Fixed Budget (7,788 units) 5 778,000 Actual Results 272,300 116,700 31,120 85,540 505,700 $ 272,300 Prepare a flexible budget performance…
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Budgeting for a Merchandising Firm Goldberg Company is a retail sporting goods store thatuses an accrual accounting system. Facts regarding its operations follow:∙ Sales are budgeted at $250,000 for December and $225,000 for January, terms 1/eom, n/60.∙ Collections are expected to be 50% in the month of sale and 48% in the month following the sale.Two percent of sales are expected to be uncollectible and recorded in an allowance account at theend of the month of sale. Bad debts expense is included as part of operating expenses.∙ Gross margin is 30% of gross sales.∙ All accounts receivable are from credit sales. Bad debts are written off against the allowanceaccount at the end of the month following the month of sale.∙ Goldberg desires to have 80% of the merchandise for the following month’s sales on hand at the endof each month. Payment for merchandise is made in the month following the month of purchase.∙ Other monthly operating expenses to be paid in cash total $25,000.∙ Annual…
Flexible Budget for Selling and Administrative Expenses Fuller Enterprises uses flexible budgets that are based on the following data: Sales commissions 8% of sales Advertising expense 20% of sales Customer support expense $2,150 plus 4% of sales Office salaries expense $14,000 per month Miscellaneous administrative expense $2,600 plus 3% of sales Research and development expense $1,500 per month Prepare a flexible selling and administrative expenses budget for July for sales volumes of $95,000, $120,000, and $145,000. (Use Exhibit 5 as a model.) Enter all amounts as positive numbers. FULLER ENTERPRISES Flexible Selling and Administrative Expenses Budget For the Month Ending July 31 Total sales $95,000 $120,000 $145,000 Variable cost: $fill in the blank 2 $fill in the blank 3 $fill in the blank 4 fill in the blank 6 fill in the blank 7 fill in the blank 8 fill in the blank 10 fill in the blank 11 fill in the blank 12 fill in the blank…
Flexible budget for selling and administrative expenses for a service company Digital Solutions Inc. uses flexible budgets that are based on the following data: Sales commissions Advertising expense Miscellaneous administrative expense Office salaries expense Customer support expenses Research and development expense 14% of sales 18% of sales $5,500 per month plus 12% of sales $30,000 per month $12,000 per month plus 20% of sales $32,000 per month Prepare a flexible selling and administrative expenses budget for October for sales volumes of $400,000, $500,000, and $600,000. (Use Exhibit 4 as a model.) Digital Solutions Inc. Flexible Selling and Administrative Expenses Budget Line Item Description For the Month Ending October 31 Amount $400,000 Amount Amount $500,000 $600,000 Total sales Variable cost: Sales commissions 56,000 70,000 Advertising expense 72,000 90,000 Miscellaneous administrative expense 48,000 60,000 Customer support expenses 80,000 100,000 Total variable cost 256,000…
Assume a company's sales budget for July estimates 15,000 units sold. The variable selling and administrative expense used for budgeting purposes is $4.00 per unit sold. The total budgeted fixed selling and administrative expense for July is $80,000 including depreciation of $15,000. What is the total budgeted selling and administrative expense for July? Multiple Choice $120,000 $155,000 $125,000 $140,000
Weller Company's budgeted unit sales for the upcoming fiscal year are provided below: 1st Quarter 2nd Quarter 3rd Quarter 4th Quarter Budgeted unit sales 22,000 23,000 20,000 20,000 The company’s variable selling and administrative expense per unit is $2.10. Fixed selling and administrative expenses include advertising expenses of $15,000 per quarter, executive salaries of $41,000 per quarter, and depreciation of $21,000 per quarter. In addition, the company will make insurance payments of $4,000 in the first quarter and $4,000 in the third quarter. Finally, property taxes of $6,400 will be paid in the second quarter. Required: Prepare the company’s selling and administrative expense budget for the upcoming fiscal year. Note: Round "Per Unit" answers to 2 decimal places.
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