Cloud Productivity Inc. uses flexible budgets that are based on the following da

Question

Cloud Productivity Inc. uses flexible budgets that are based on the following data: Sales commissions Advertising expense Miscellaneous administrative expense Office salaries expense Customer support expenses Research and development expense Prepare a flexible selling and administrative expenses budget for March 2016 for sales volumes of $400,000, $500,000, and $600,000. Enter all amounts as positive numbers 14% of sales 18% of sales $6,500 per month plus 12% of sales $28,000 per month $12,000 per month plus 20% of sales $30,000 per month Eloud Productivity Inc. Flexible Selling and Administrative Expenses Budget For the Month Ending March 31, 2016 400,000 $500,000 $600,000 Total sales Variable cost: Sales commissions Advertising expense Miscellaneous administrative expense Customer support expense Total variable cost Next Check My Work

Explanation / Answer

Flexible selling and administrative Expense Budget Ending on March,2016

Total sales $400000 $500000 $600000

Variable cost :

Sales commission(14% on sale) 56000 70000 84000

Advertsing expense(18% on sale) 72000 90000 108000

Miscellaneous Administrative(12% on sale) 48000 60000 72000

customer support expense( 20% on sale) 80000 100000 120000

   Total variable cost 256000 320000 384000

  Fixed Cost :

Miscellaneous Administrative 6500 6500 6500

Office salary expense 28000 28000 28000

customer support expense 12000 12000 12000

Research and development expense 30000 30000 30000

   Total Fixed cost 76500 76500 76500

Total selling and administrative Expenses 332500 396500 460500

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