Question

Weller Company's budgeted unit sales for the upcoming fiscal year are provided below:

	1st Quarter	2nd Quarter	3rd Quarter	4th Quarter
Budgeted unit sales	23,000	24,000	21,000	21,000

The company’s variable selling and administrative expense per unit is $2.20. Fixed selling and administrative expenses include advertising expenses of $8,000 per quarter, executive salaries of $41,000 per quarter, and depreciation of $22,000 per quarter. In addition, the company will make insurance payments of $5,000 in the first quarter and $5,000 in the third quarter. Finally, property taxes of $7,400 will be paid in the second quarter.

Required:

Prepare the company’s selling and administrative expense budget for the upcoming fiscal year. (Round "Per Unit" answers to 2 decimal places.)

Answer 1

Weller Company Selling and Administrative expense budget 1st quarter 2nd quarter 3rd quarter 4th quarter Year Budgeted unit sales 23000 24000 21000 21000 89000 Variable selling and admin expense per unit $2.20 $2.20 $2.20 $2.20 $2.20 Variable selling and admin expense $50,600.00 $52,800.00 $46,200.00 $46,200.00 $195,800.00 Fixed selling and admin expense : Advertising $ 8,000.00 $ 8,000.00 $ 8,000.00 $ 8,000.00 $ 32,000.00 Executive salaries $ 41,000.00 $ 41,000.00 $ 41,000.00 $ 41,000.00 $ 164,000.00 Insurance $ 5,000.00 $ - $ 5,000.00 $ $ 10,000.00 property taxes - $ 7,400.00 $ - $ - $ 7,400.00 Depreciation $ 22,000.00 $ 22,000.00 $ 22,000.00 $ 22,000.00 $ 88,000.00 Total fixed selling and admin expense $ 76,000.00 $ 78,400.00 $ 76,000.00 $ 71,000.00 $ 301,400.00 Total selling and admin Expense $ 126,600.00 $ 131,200.00 $ 122,200.00 $ 117,200.00 $ 497,200.00 Less : Depreciation $ (22,000.00) $ (22,000.00) $ (22,000.00) $ (22,000.00) $ (88,000.00) Cash disbursements for selling and admin expense $ 104,600.00 $ 109,200.00 $ 100,200.00 $ 95,200.00 $ 409,200.