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 8% of sales Advertising expense 15% of sales Miscellaneous administrative expense $10,000 per month plus 4% of sales Office salaries expense $50,000 per month Customer support expenses $20,000 per month plus 30% of sales Research and development expense $75,000 per month Prepare a flexible selling and administrative expenses budget for October for sales volumes of $500,000, $750,000, and $1,000,000. (Use Exhibit 5 as a model.) Digital Solutions Inc. Flexible Selling and Administrative Expenses Budget For the Month Ending October 31 Total sales $500,000 $750,000 $1,000,000 Variable cost: $- Select - $- Select - $- Select - - Select - - Select - - Select - - Select - - Select - - Select - - Select - - Select - - Select - Total variable cost $fill in the blank 17 $fill in the blank 18 $fill in the blank 19 Fixed cost: $- Select - $- Select - $- Select - - Select - - Select - - Select - - Select - - Select - - Select - - Select - - Select - - Select - 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

Cornerstones of Cost Management (Cornerstones Series)

4th Edition

ISBN:9781305970663

Author:Don R. Hansen, Maryanne M. Mowen

Publisher:Don R. Hansen, Maryanne M. Mowen

Chapter8: Budgeting For Planning And Control

Section: Chapter Questions

Problem 11CE: Shalimar Company manufactures and sells industrial products. For next year, Shalimar has budgeted...

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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	8% of sales
Advertising expense	15% of sales
Miscellaneous administrative expense	$10,000 per month plus 4% of sales
Office salaries expense	$50,000 per month
Customer support expenses	$20,000 per month plus 30% of sales
Research and development expense	$75,000 per month

Prepare a flexible selling and administrative expenses budget for October for sales volumes of $500,000, $750,000, and $1,000,000. (Use Exhibit 5 as a model.)

Digital Solutions Inc.
Flexible Selling and Administrative Expenses Budget
For the Month Ending October 31

Total sales	$500,000	$750,000	$1,000,000
Variable cost:
	$- Select -	$- Select -	$- Select -
	- Select -	- Select -	- Select -
	- Select -	- Select -	- Select -
	- Select -	- Select -	- Select -
Total variable cost	$fill in the blank 17	$fill in the blank 18	$fill in the blank 19
Fixed cost:
	$- Select -	$- Select -	$- Select -
	- Select -	- Select -	- Select -
	- Select -	- Select -	- Select -
	- Select -	- Select -	- Select -
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