Question

Johnson Company combines its operating expenses for budget purposes in a selling and administrative expense budget. For the first 6 months of 2020, the following data are available.

1. Sales: 20,800 units quarter 1; 22,100 units quarter 2.

2. Variable costs per dollar of sales: sales commissions 5%, delivery expense 2%, and advertising 3%.

3. Fixed costs per quarter: sales salaries $10,900, office salaries $6,480, depreciation $4,400, insurance $1,910, utilities $830, and repairs expense $640

4. Unit selling price: $21

-Prepare a selling and administrative expense budget by quarters for the first 6 months of 2020:

Quarter 1 Quarter 2 Six Months

_____________________________________________________________________________________________________________________________________________

Budgeted sales in units

Variable expenses

Sales commissions

Delivery Expense

Advertising

Total variable

Fixed expenses

Sales salaries

Office salaries

Depreciation

Insurance

Utilities

Repairs expense

Total fixed

Total selling and administrative expenses

Answer 1

Six Months Total Johnson Company Selling and administration expenses Budget For the first six months 2020 Quarter 1 2 Budgeted Sales in units inits T 2 0800 22100 Variable Expenses: Sales Commissions 5% 21840 23205 Delivery expenses 2% 8736 9282 Advertising 3% 13104 13923 Total variable cost 43680 46410 Fixed cost: Sales salaries 10900 10900 Office salaries 6480 6480 Depreciation 4400 4400 Insurance 1910 1910 Utilities 830 830 Repair expenses 640 640 Total fixed expenses 25160 25160 Total Selling and administrative expenses 68840 71570) 45045 18018 27027 90090 21800 12960 8800 3820 1660 1280 50320 140410