repare a monthly flexible selling expense budget for Podism Company for sales volumes of $270,000, $350,000, and $486 Fales commissions 7% of sales ales manager's salary $62,000 per month dvertising expense $70,000 per month hipping expense 2% of sales Tiscellaneous selling expense $2,500 per month plus 1/2% of sales Podism Company Monthly Selling Expense Budget Sales volume $270,000 $350,000 $480,000 Variable expense: Sales commissions Shipping expense Miscellaneous selling expense X X X

repare a monthly flexible selling expense budget for Podism Company for sales volumes of $270,000, $350,000, and $486 Fales commissions 7% of sales ales manager's salary $62,000 per month dvertising expense $70,000 per month hipping expense 2% of sales Tiscellaneous selling expense $2,500 per month plus 1/2% of sales Podism Company Monthly Selling Expense Budget Sales volume $270,000 $350,000 $480,000 Variable expense: Sales commissions Shipping expense Miscellaneous selling expense X X X

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter16: Cost-volume-profit Analysis

Section: Chapter Questions

Problem 1CE

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Concept explainers

Master Budget

A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.

Sales Budget and Selling

A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.

Question

Prepare a monthly flexible selling expense budget for Podism Company for sales volumes of $270,000, $350,000, and $480,000, based on the following data:
Sales commissions
7% of sales
Sales manager's salary
$62,000 per month
Advertising expense
$70,000 per month
Shipping expense
2% of sales
Miscellaneous selling expense
$2,500 per month plus 1/2% of sales
Podism Company
Monthly Selling Expense Budget
Sales volume
$270,000
$350,000
$480,000
Variable expense:
Sales commissions
х
X
Shipping expense
X
Miscellaneous selling expense
Total variable expense
Fixed expense:
Sales manager's salary
x $
Advertising expense
X
Miscellaneous selling expense
Total fixed expense
%$4
Total selling expense
$
X

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