Vaughn Manufacturing makes and sells umbrellas. The company is in the process of preparing its Selling and Administrative Expense Budget for the last half of the year. The following budget data are available: Variable Cost Per Unit Sold Monthly Fixed Cost Sales commissions $0.60 $ 6500 Shipping 1.20 Advertising 0.30 Executive salaries 35000 Depreciation on office equipment 7000 Other 0.35 22000 Expenses are paid in the month incurred. If the company has budgeted to sell 6500 umbrellas in October, how much is the total budgeted variable selling and administrative expenses for October? $16908 $13650 $15925 $86425
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.
Vaughn Manufacturing makes and sells umbrellas. The company is in the process of preparing its Selling and Administrative Expense Budget for the last half of the year. The following budget data are available:
| Variable Cost Per Unit Sold | Monthly Fixed Cost | ||
| Sales commissions | $0.60 | $ 6500 | |
| Shipping | 1.20 | ||
| Advertising | 0.30 | ||
| Executive salaries | 35000 | ||
| 7000 | |||
| Other | 0.35 | 22000 |
Expenses are paid in the month incurred. If the company has budgeted to sell 6500 umbrellas in October, how much is the total budgeted variable selling and administrative expenses for October?
$16908
$13650
$15925
$86425
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