Question

Sales for the final quarter of the prior year total 800 units. Expected sales in units) for the current year are: 720 (Quarter 1), 480 (Quarter 2), 640 (Quarter 3), and 640 (Quarter 4). Sales for the first quarter of the following year total 960 units. The selling price is $660 per unit in the first three quarters of the year, and $690 per unit in the final quarter. Company policy calls for a given quarter's ending finished goods inventory to equal 50% of the next quarter's expected unit sales. The finished goods inventory at the end of the prior year is 360 units, which complies with the policy. The product's manufacturing cost is $191 per unit, including per unit costs of $112 for materials (8 lbs. at $14 per lb.), $60 for direct labor (3 hours x $20 direct labor rate per hour), $15 for variable overhead, and $4 for fixed overhead. Annual fixed overhead consists, incurred evenly throughout the year, consist of depreciation on production equipment, $4,200; factory utilities, $5,200, and other factory overhead of $1,000. Company policy also calls for a given quarter's ending raw materials inventory to equal 50% of next quarter's expected materials needed for production. The prior year-end inventory is 2,400 lbs of materials, which complies with the policy. The company expects to have 3,840 lbs. of materials in inventory at year-end. The company has no work in process inventory at the end of any quarter. Sales representatives' commissions are 16% of sales and are paid in the quarter of the sales. The sales manager's quarterly salary will be $52,000 in the first three quarters of the year, and $55,000 in the final quarter. Quarterly general and administrative expenses include $22,000 administrative salaries, rent expense of $13,000 per quarter, insurance expense of $10,000 per quarter, straight- line depreciation of $10,000 per quarter, and 1% monthly interest on the $400,000 long-term note payable (12% annually). f. Income taxes will be assessed at 30%, and are paid in the quarter incurred.
DUE SOON, PLEASE HELP!!!

Answer 1

Solution:

Ham Inc.
Selling expenses Budget
For the year ended Dec 31, 2018
	First Qtr.	Second Qtr.	Third Qtr.	Fourth Qtr.	Total
Budgeted sales	$475,200.00	$316,800.00	$422,400.00	$441,600.00	$1,656,000.00
% of sales commision	16%	16%	16%	16%	16%
sales commissions	$76,032.00	$50,688.00	$67,584.00	$70,656.00	$264,960.00
Sales manager's salary	$52,000.00	$52,000.00	$52,000.00	$55,000.00	$211,000.00
Total budgeted selling expenses	$128,032.00	$102,688.00	$119,584.00	$125,656.00	$475,960.00