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 6% of sales Advertising expense 14% of sales Miscellaneous administrative expense $11,000 per month plus 4% of sales Office salaries expense $52,000 per month Customer support expenses $18,000 per month plus 31% of sales Research and development expense $78,000 per month This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the question below. Open spreadsheet Prepare a flexible selling and administrative expenses budget for October for sales volumes of $600,000, $900,000, and $1,000,00o. (Use Exhibit 5 as a model.) Enter all amounts as positive numbers. Digital Solutions Inc. Flexible Selling and Administrative Expenses Budget For the Month Ending October 31 Total sales $600,000 $900,000 $1,000,000 Variable cost: Total variable cost Fixed cost: Total fixed cost Total selling and administrative expenses

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 6% of sales Advertising expense 14% of sales Miscellaneous administrative expense $11,000 per month plus 4% of sales Office salaries expense $52,000 per month Customer support expenses $18,000 per month plus 31% of sales Research and development expense $78,000 per month This information has been collected in the Microsoft Excel Online file. Open the spreadsheet, perform the required analysis, and input your answers in the question below. Open spreadsheet Prepare a flexible selling and administrative expenses budget for October for sales volumes of $600,000, $900,000, and $1,000,00o. (Use Exhibit 5 as a model.) Enter all amounts as positive numbers. Digital Solutions Inc. Flexible Selling and Administrative Expenses Budget For the Month Ending October 31 Total sales $600,000 $900,000 $1,000,000 Variable cost: Total variable cost Fixed cost: Total fixed cost Total selling and administrative expenses

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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A manager is preparing a revenue budget for next month. The following is the manager’s current month actual operating results. ACTUAL OPERATING RESULTS CURRENT MONTH Revenue Source Number of Guests Average Sale per Guest Sales Restaurant 3492 $20.50 $71,586 Lounge 515 $12.00 $ 6,180 Banquet room 388 $28.50 $11,058 Total 4395 $20.21 $88,824 Create the revenue forecast for next month based on the following assumptions. Restaurant guest counts will be 3,600 with an average sale per guest of $21.00. Lounge guests to be served are estimated at 525 with a 10 percent increase in average sale per guest. The banquet room will serve 425 customers and generate $12,750 in sales. NEXT MONTH BUDGET Revenue Source Number of Guests Average Sale per Guest Sales Restaurant 3,600.00 ? ? Lounge ? ? ? Banquet room ? ? ? Total ? ? ? What will be the manager’s revenue forecast for next month?…
Flexible Budget for Selling and Administrative Expenses for a Service Company Daybreak Technologies Inc. uses flexible budgets that are based on the following data: Sales commissions 9% of sales Advertising expense 19% of sales Miscellaneous administrative expense $1,300 per month plus 2% of sales Office salaries expense $12,000 per month Customer support expenses $1,800 plus 3% of sales Research and development expense $3,200 per month Prepare a flexible selling and administrative expenses budget for April for sales volumes of $80,000, $100,000, and $120,000. Daybreak Technologies Inc. Flexible Selling and Administrative Expenses Budget For the Month Ending April 30 Total sales $80,000 $100,000 $120,000 Variable cost: Sales commissions 7,200 9,000V 10,800 Advertising expense Miscellaneous administrative expense Customer support expenses Total variable cost Fixed cost: Miscellaneous administrative expense 1,300 1,300 1,300 12,000V 12,000 V 12,000 Office salaries expense 1,800 V 1,800V…
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es Required information [The following information applies to the questions displayed below.] Adger Corporation is a service company that measures its output based on the number of customers served. The company provided the following fixed and variable cost estimates for budgeting purposes and the actual results for May as shown below. Revenue Employee salaries and wages Travel expenses Other expenses Fixed Element per Month $ 50,000 $ 36,000 Variable Element per Customer Served $ 5,000 $ 1,100 Actual Total for May $ 160,000 $ 88,000 $ 600 $ 19,000 $ 34,500 When preparing its planning budget, the company estimated it would serve 30 customers per month; however, during May the company actually served 35 customers. Required: 1. What amount of revenue would be included in Adger's flexible budget for May?
Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared monthly for each department. The planning budget and flexible budget for the Production Department are based on the following formulas, where q is the number of labor-hours worked in a month: Cost Formulas Direct labor $16.40q Indirect labor $4,000 + $1.40q Utilities $5,300 + $0.30q Supplies $1,600 + $0.10q Equipment depreciation $18,500 + $3.00q Factory rent $8,200 Property taxes $2,500 Factory administration $13,600 + $0.60q The Production Department planned to work 4,400 labor-hours in March; however, it actually worked 4,200 labor-hours during the month. Its actual costs incurred in March are listed below: Actual Cost Incurred in March Direct labor $ 70,480 Indirect labor $ 9,340 Utilities $ 7,010 Supplies $ 2,250 Equipment depreciation $ 31,100 Factory rent $ 8,600 Property taxes $ 2,500 Factory…
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 14% of sales Advertising expense 20% of sales Miscellaneous administrative expense $6,000 per month plus 12% of sales Office salaries expense $30,000 per month Customer support expenses $12,000 per month plus 20% of sales Research and development expense $30,000 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: $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…
Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared monthly for each department. The planning budget and flexible budget for the Production Department are based on the following formulas, where q is the number of labor-hours worked in a month: Direct labor Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes Factory administration Cost Formulas $16.30q $4,300 +$1.50g $5,300 +$0.40g $1.400+ $0.30q $18,200+ $2.70g $8,400 $13,800+ $0.60g $2,600 The Production Department planned to work 4,200 labor-hours in March; however, it actually worked 4,000 labor-hours during the month. Its actual costs incurred in March are listed below: Direct labor Actual Cost Incurred in March $ 66,780 Indirect labor Utilities Supplies Equipment depreciation Factory rent Property taxes Factory administration Required: $ 9,780 $ 7,370 $ 2,870 $ 29,000 $ 8.800 $ 2,600 $ 15,550 1. Prepare the Production…
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Packaging Solutions Corporation manufactures and sells a wide variety of packaging products. Performance reports are prepared monthly for each department. The planning budget and flexible budget for the Production Department are based on the following formulas, where q is the number of labor - hours worked in a month: Cost Formulas Direct labor $ 16.50q Indirect labor $4,600+ $1.40q Utilities $5,300 + $0.70q Supplies $1,300 + $0.20q Equipment depreciation $ 18,100 + $2.70q Factory rent $8, 100 Property taxes $2,800 Factory administration $13,400 + $0.70q The Production Department planned to work 4, 400 labor - hours in March; however, it actually worked 4, 200 labor - hours during the month. Its actual costs incurred in March are listed below: Actual Cost Incurred in March Direct labor $ 70, 920 Indirect labor $ 9,940 Utilities $ 8,770 Supplies $ 2,390 Equipment depreciation $ 29,440 Factory rent $ 8,500 Property taxes $ 2,800 Factory administration $ 15,710 Required: 1. Prepare the…