Brief Exercise 21-7 Elbert Company classifies its selling and administrative exp

ID: 2594875 • Letter: B

Question

Brief Exercise 21-7 Elbert Company classifies its selling and administrative expense budget into variable and fixed components. Variable expenses are expected to be $26,800 in the first quarter, and $5,410 increments are expected in the remaining quarters of 2017. Fixed expenses are expected to be $40,760 in each quarter.
Prepare the selling and administrative expense budget by quarters and in total for 2017.

Brief Exercise 21-7 Elbert Company classifies its selling and administrative expense budget into variable and fixed components. Variable expenses are expected to be $26,800 in the first quarter, and $5,410 increments are expected in the remaining quarters of 2017. Fixed expenses are expected to be $40,760 in each quarter. Prepare the selling and administrative expense budget by quarters and in total for 2017. ELBERT COMPANY Selling and Administrative Expense Budget Quarter Year Variable espenses Fised espemses iminiewieen Click if you would like to Show Work for this question: Qpen Show Work

Explanation / Answer

Solution

ELBERT COMPANY

Selling and Administrative Expense Budget

For the Year Ended December 31, 2017

Particulars

Quarter ($)

Year ($)

1 ($)

2 ($)

3 ($)

4 ($)

*Variable expenses

26,800

32,210

37,620

43,030

139,660

Fixed expenses

40,760

163,040

Total budgeted selling and administrative expenses

67,560

72,970

78,380

83,790

302,700

*Variable expenses Calculation:

Given Information: Variable expenses are expected to be $26,800 in the first quarter, and $ 5,410 increments are expected in the remaining quarters of 2017.

Quarter 1 = $ 26,800 (Given)

Quarter 2 =$ 26,800 + $ 5,410 = $ 32,210

Quarter 3 =$ 32,210 + $ 5,410= $ 37,620

Quarter 4 =$ 37,620 + $ 5,410 = $ 43,030