Vandel Inc. bases its selling and administrative expense budget on budgeted unit

Question

Vandel Inc. bases its selling and administrative expense budget on budgeted unit sales. The sales budget shows 2,100 units are planned to be sold in April. The variable selling and administrative expense is $4.60 per unit. The budgeted fixed selling and administrative expense is $35,710 per month, which includes depreciation of $3,600 per month. The remainder of the fixed selling and administrative expense represents current cash flows. The cash disbursements for selling and administrative expense on the April selling and administrative expense budget should be:

Explanation / Answer

Total cash disbursement is as under:

Particulars Amt Variable Expenses
(2100 x 4.60) 9660 Fixed Expenses
(35710-3600) 32110 Total cash paid in april 41770

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