Question

The following information is available for Pioneer Company: • Sales price per unit is $80. • November and December, sales were budgeted at 3,000 and 3,580 units, respectively. • Variable costs are 10 percent of sales (5 percent commission, 1 percent advertising, 4 percent shipping). • Fixed costs per month are sales salaries, $4,000; office salaries, $2,700; depreciation, $2,900; building rent, $3,600; insurance, $1,600; and utilities, $800. Required: Determine Pioneer's budgeted selling and administrative expenses for November and December. November December Total Budgeted Selling and Administrative Expenses

Answer 1

Answer- Total Budgeted Selling & Administrative Expenses- November = $39600

December = $44240.

Explanation-

PIONEER COMPANY
FLEXIBLE SELLING AND ADMINISTRATIVE EXPENSES BUDGET
FOR THE MONTH ENDING NOVEMBER & DECEMBER
Particulars	November	December
	$	$
Sales units (a)	3000	3580
Selling prive per unit (b)	$80	9$80
Sales value (c=a*b)	240000	286400
Variable Expesnes:- % of sales
Sales commissions 5% of sales	12000	14320
Advertising expense 1% of sales	2400	2864
Shipping 4% of sales	9600	11456
Total Variable expenses (a)	24000	28640
Fixed Expenses:-
Sales salaries	4000	4000
Office salaries	2700	2700
Depreication	2900	2900
Building rent	3600	3600
Insurance	1600	1600
Utilities	800	800
Total Fixed expenses (b)	15600	15600
Total Selling and Administrative Expenses (c=a+b)	39600	44240