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	22,000	23,000	20,000	20,000

The company’s variable selling and administrative expense per unit is $2.10. Fixed selling and administrative expenses include advertising expenses of $15,000 per quarter, executive salaries of $41,000 per quarter, and depreciation of $21,000 per quarter. In addition, the company will make insurance payments of $4,000 in the first quarter and $4,000 in the third quarter. Finally, property taxes of $6,400 will be paid in the second quarter.

Prepare the company’s selling and administrative expense budget for the upcoming fiscal year.

Answer 1

Weller Company Selling and Administrative expense budget 2nd quarter 3rd quarter 4th quarter 1st quarter Year Budgeted unit sales Variable selling and admin expense per unit Variable selling and admin expense Fixed selling and admin expense 23000 22000 20000 20000 85000 $2.10 $46,200.00 $2.10 $48,300.00 $2.10 $42,000.00 $2.10 $42,000.00 $2.10 $178,500.00 $ 15,000.00 $ $ 41,000.00 $ $ 15,000.00 15,000.00 $ 41,000.00 $ 41,000.00 $ $ 15,000.00 60,000.00 41,000.00 164,000.00 Advertising Executive salaries 4,000.00$ $ $ $ 8,000.00 $ 6,400.00 84,000.00 $ 4,000.00 $ Insurance $ 6,400.00 $ $ 21,000.00 21,000.00 81,000.00 77,000.00 $322,400.00 property taxes Depreciation Total fixed selling and admin expense 21,000.00$ 81,000.00 83,400.00 $ 21,000.00 Total selling and admin Expense Less : Depreciation Cash disbursements for selling and admin expense $127,200.00 $131,700.00 $123,000.00 $119,000.00 $500,900.00 $ (21,000.00) $ (21,000.00) $ (21,000.00) $ (21,000.00) $ (84,000.00) $106,200.00 $110,700.00 $102,000.00 98,000.00 $416,900.00