The Puyer Corporation makes and sells only one product called a Deb. The company

Question

The Puyer Corporation makes and sells only one product called a Deb. The company is in the process of preparing its Selling and Administrative Expense Budget for next year. The following budget data are available: Monthly Variable Fixed Cost Per Deb Sold Cost $0.90 $1.40 Sales commissions Shipping Advertising Executive salaries Depreciation on office equipment Other $50,000 $8.20 $60,000 $20,000 $40,000 All of these expenses (except depreciation) are paid in cash in the month they are incurred If the company has budgeted to sell 16,000 Debs in January, then the total budgeted variable selling and administrative expenses for January will be: Multiple Choice K Prey 19 of 25 Next> TOSHIBA

Explanation / Answer

Answer:$40000

Total Variable cost per unit = Sales Commission + Shipping + Advertising = $0.90+$1.40+$0.20 = $2.50

Therefore total Varible cost for 16000 units = 16000 x $2.50 = $40000

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