Flexible Budget for Selling and Administrative Expenses for a Service CompanyDigital Solutions Inc. uses flexible budgets that are based on the following data:Sales commissions14% of salesAdvertising expense20% of salesMiscellaneous administrative expense$6,000 per month plus 12% of salesOffice salaries expense$30,000 per monthCustomer support expenses$12,000 per month plus 20% of salesResearch and development expense$30,000 per monthPrepare 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 BudgetFor the Month Ending October 31Total sales$400,000$500,000$600,000Variable cost: $fill in the blank 2$fill in the blank 3$fill in the blank 4 fill in the blank 6fill in the blank 7fill in the blank 8 fill in the blank 10fill in the blank 11fill in the blank 12 fill in the blank 14fill in the blank 15fill in the blank 16Total variable cost$fill in the blank 17$fill in the blank 18$fill in the blank 19Fixed cost: $fill in the blank 21$fill in the blank 22$fill in the blank 23 fill in the blank 25fill in the blank 26fill in the blank 27 fill in the blank 29fill in the blank 30fill in the blank 31 fill in the blank 33fill in the blank 34fill in the blank 35Total fixed cost$fill in the blank 36$fill in the blank 37$fill in the blank 38Total selling and administrative expenses$fill in the blank 39$fill in the blank 40$fill in the blank 41

The flexible budget is a dynamic budget which can be adjusted according to the changes in volume.…

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FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

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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	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 12
	fill in the blank 14	fill in the blank 15	fill in the blank 16
Total variable cost	$fill in the blank 17	$fill in the blank 18	$fill in the blank 19
Fixed cost:
	$fill in the blank 21	$fill in the blank 22	$fill in the blank 23
	fill in the blank 25	fill in the blank 26	fill in the blank 27
	fill in the blank 29	fill in the blank 30	fill in the blank 31
	fill in the blank 33	fill in the blank 34	fill in the blank 35
Total fixed cost	$fill in the blank 36	$fill in the blank 37	$fill in the blank 38
Total selling and administrative expenses	$fill in the blank 39	$fill in the blank 40	$fill in the blank 41

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