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.)

FINANCIAL ACCOUNTING
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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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