Flint Company uses flexible budgets to control its selling expenses. Monthly sales are expected to range from $200,600 to $236,000. Variable costs and their percentage relationship to sales are sales commissions 6%, advertising 4%, travel 3%, and delivery 2%. Fixed selling expenses will consist of sales salaries $41,300, depreciation on delivery equipment $8,260, and insurance on delivery equipment $1.180. Prepare a monthly selling expense flexible budget for each $11,800 increment of sales within the relevant range for the year ending December 31, 2022. (List variable costs before foxed costs)

Flint Company uses flexible budgets to control its selling expenses. Monthly sales are expected to range from $200,600 to $236,000. Variable costs and their percentage relationship to sales are sales commissions 6%, advertising 4%, travel 3%, and delivery 2%. Fixed selling expenses will consist of sales salaries $41,300, depreciation on delivery equipment $8,260, and insurance on delivery equipment $1.180. Prepare a monthly selling expense flexible budget for each $11,800 increment of sales within the relevant range for the year ending December 31, 2022. (List variable costs before foxed costs)

Principles of Cost Accounting

17th Edition

ISBN:9781305087408

Author:Edward J. Vanderbeck, Maria R. Mitchell

Publisher:Edward J. Vanderbeck, Maria R. Mitchell

Chapter10: Cost Analysis For Management Decision Making

Section: Chapter Questions

Problem 16E

See similar textbooks

Similar questions

Sales Revenue Approach, Variable Cost Ratio, Contribution Margin Ratio Arberg Companys controller prepared the following budgeted income statement for the coming year: Required: 1. What is Arbergs variable cost ratio? What is its contribution margin ratio? 2. Suppose Arbergs actual revenues are 30,000 more than budgeted. By how much will operating income increase? Give the answer without preparing a new income statement 3. How much sales revenue must Arberg earn to break even? Prepare a contribution margin income statement to verify the accuracy of your answer. 4. What is Arbergs expected margin of safety? 5. What is Arbergs margin of safety if sales revenue is 380,000?
Kerr Manufacturing sells a single product with a selling price of $600 with variable costs per unit of $360. The companys monthly fixed expenses are $72,000. What is the companys break-even point in units? What is the companys break-even point in dollars? Prepare a contribution margin income statement for the month of January when they will sell 500 units. How many units will Kerr need to sell in order to realize a target profit of $120,000? What dollar sales will Kerr need to generate in order to realize a target profit of $120,000? Construct a contribution margin income statement for the month of June that reflects $600,000 in sales revenue for Kerr Manufacturing.
Maple Enterprises sells a single product with a selling price of $75 and variable costs per unit of $30. The companys monthly fixed expenses are $22,500. What is the companys break-even point in units? What is the companys break-even point in dollars? Construct a contribution margin income statement for the month of September when they will sell 900 units. How many units will Maple need to sell in order to reach a target profit of $45,000? What dollar sales will Maple need in order to reach a target profit of $45,000? Construct a contribution margin income statement for Maple that reflects $150,000 in sales volume.
Cadiz Co. uses flexible budgets to control its selling expenses. Monthly sales are expected to be from $300,000 to $360,000. Variable costs and their percentage relationships to sales are: Sales commissions 5% Advertising 4% Traveling 7% Delivery 1% Fixed selling expenses consist of sales salaries $40,000 and depreciation on delivery equipment $10,000. The actual selling expenses incurred in February, 2020, by Cadiz are as follows: Sales commissions $17,200 Advertising 12,000 Traveling 23,700 Delivery 2,400 Fixed selling expenses consist of sales salaries $41,500 and depreciation on delivery equipment $10,000. Instructions Prepare a flexible budget performance report, assuming that February sales wore $330,000.
Fallon Company uses flexible budgets to control its selling expenses. Monthly sales are expected to range from $167,300 to $209,300. Variable costs and their percentage relationship to sales are sales commissions 7%, advertising 6%, travel 4%, and delivery 1%. Fixed selling expenses will consist of sales salaries $34,900, depreciation on delivery equipment $7,100, and insurance on delivery equipment $1,900.Prepare a monthly selling expense flexible budget for each $14,000 increment of sales within the relevant range for the year ending December 31, 2020. (List variable costs before fixed costs.) FALLON COMPANYMonthly Selling Expense Flexible BudgetFor the Year 2020 AdvertisingActivity LevelDepreciationDeliveryFixed ExpensesInsuranceSalesSales CommissionsSales SalariesTotal ExpensesTotal Fixed ExpensesTotal Variable ExpensesTravelVariable Expenses…
Fallon Company uses flexible budgets to control its selling expenses. Monthly sales are expected to range from $170,000 to $200,000. Variable costs and their percentage relationship to sales are sales commissions 6%, advertising 4%, travel 3%, and delivery 2%. Fixed selling expenses will consist of sales salaries $35,000, depreciation on delivery equipment $7,000, and insurance on delivery equipment $1,000. Prepare a monthly selling expense flexible budget for each $10,000 increment of sales within the relevant range for the year ending December 31, 2020. (List variable costs before fixed costs.)
Fazel Company makes and sells paper products. In the coming year, Fazel expects total sales of $19,730,000. There is a 3% commission on sales. In addition, fixed expenses of the sales and administrative offices include the following: Salaries $ 960,000 Utilities 365,000 Office space 230,000 Advertising 1,200,000 Required: Prepare a selling and administrative expenses budget for Fazel Company for the coming year. What is the answer for variable selling expenses? Total selling and administrative expenses?
XYZ Co. makes and sells product AB. The company provides the following data about its selling and administrative expenses budget: Monthly Fixed Cost Variable cost per unit sold Sales Commissions P0.75 Shipping P1.30 Advertising P30,000 P0.20 Executive salaries P25,000 Depreciation P15,000 Other expenses P7,000 All expenses except depreciation of office equipment are paid in cash in the month they are incurred. The company has budgeted to sell 18,000 units of product AB in August 2021. Questions: 1. How much is the total budgeted selling and administrative expenses for August 2021? 2. Assuming the cash disbursements for selling and administrative expenses total P116,000, then how many units of product AB does the company plan to sell?
The actual selling expenses incurred in March 2020 by Fallon Company are as follows. Variable Expenses Fixed Expenses Sales commissions $10,994 Sales salaries $35,400 Advertising 10,304 Depreciation 7,100 Travel 8,470 Insurance 1,300 Delivery 3,498 (a) Prepare a flexible budget performance report for March, assuming that March sales were $169,400. Variable costs and their percentage relationship to sales are sales commissions 6%, advertising 6%, traveling 5%, and delivery 2%. Fixed selling expenses will consist of sales salaries $35,400, Depreciation on delivery equipment $7,100, and insurance on delivery equipment $1,300. (List variable costs before fixed costs.) (b)Prepare a flexible budget performance report, assuming that March sales were $176,700. (List variable costs before fixed costs.)
Muhanga Corporation sells three products: R, S, and T. Budgeted information for the upcoming accounting period follows. Product Sales Volume (Units) Selling Price Variable Cost R 17,600 $ 19 $ 13 S 13,600 15 6 T 54,800 16 10 What is the company's weighted-average unit contribution margin?
The actual selling expenses incurred in March 2020 by Fallon Company are as follows. Variable Expenses Fixed Expenses Sales commissions $11,180 Sales salaries $35,500 Advertising 10,530 Depreciation 7,400 Travel 6,920 Insurance 1,100 Delivery 3,580 (a) Prepare a flexible budget performance report for March, assuming that March sales were $173,000. Variable costs and their percentage relationship to sales are sales commissions 6%, advertising 6%, traveling 4%, and delivery 2%. Fixed selling expenses will consist of sales salaries $35,500, Depreciation on delivery equipment $7,400, and insurance on delivery equipment $1,100. (List variable costs before fixed costs.) FALLON COMPANYSelling Expense Flexible Budget ReportFor the Month Ended March 31, 2020 Difference Budget Actual FavorableUnfavorableNeither Favorablenor Unfavorable Select an opening flexible budget report item…
Two businesses, P Ltd. and Q Ltd. sell the same type of product in the same type of market. Their budgeted profit and loss accounts for the coming year are as under: P Ltd. (Rs.) Q. Ltd. (Rs.) Sales 150000 150000 Variable Cost 120000 100000 Fixed cost 15000 35000 Budgeted Net profit 15000 15000 You are required to: Calculate the break-even point for each business Calculate the sales volume at which each business will earn Rs.5,000 Profit. State which business is likely to earn greater profit in conditions of: Heavy demand for the product Low demand for the product,and,briefly give your argument as well.