Prepare a flexible budget performance report for March, assuming that March sales were $167,100. Variable costs and their percentage relationship to sales are sales commissions 7%, advertising 7%, traveling 5%, and delivery 2%. Fixed selling expenses will consist of sales salaries $35,421, depreciation on delivery equipment $6,684, and insurance on delivery equipment $1,298.

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1.38K viewsOctober 4, 2016

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Darshita 6.14K October 4, 2016 0 Comments

Exercise 22-6

The actual selling expenses incurred in March 2014 by DeWitt Company are as follows.

Variable Expenses		Fixed Expenses
Sales commissions	$12,497	Sales salaries	$35,421
Advertising	11,777	Depreciation	6,684
Travel	8,355	Insurance	1,298
Delivery	3,446

Prepare a flexible budget performance report for March, assuming that March sales were $167,100. Variable costs and their percentage relationship to sales are sales commissions 7%, advertising 7%, traveling 5%, and delivery 2%. Fixed selling expenses will consist of sales salaries $35,421, depreciation on delivery equipment $6,684, and insurance on delivery equipment $1,298. (List variable costs before fixed costs.)

DEWITT COMPANY Selling Expense Flexible Budget Report For the Month Ended March 31, 2014
			Difference
	Budget	Actual	Favorable (F) Unfavorable (U) Neither Favorable nor Unfavorable (N)

1 Answer

score 0 · Answer 1 · 2016-10-04T16:10:56+00:00

Answer:

DEWITT COMPANY
Selling Expense Flexible Budget Report
For the Month Ended March 31, 2014

			Difference
	Budget	Actual	Favorable F Unfavorable U
Sales	167100	167100
Variable expenses
Sales commissions	11697	12497	800 U
Advertising	11697	11777	80 U
Travel	8355	8355	0
Delivery	3342	3446	104 U
Total variable expenses	35091	36075	984 U
Fixed expenses			0
Sales salaries	35421	35421	0
Depreciation	6684	6684	0
Insurance	1298	1298	0
Total fixed expenses	43403	43403	0
Total expenses	78494	79478	984 U

If sales were 174800 then , Selling Expense Flexible Budget Report as follow

DEWITT COMPANY
Selling Expense Flexible Budget Report
For the Month Ended March 31, 2014

			Difference
	Budget	Actual	Favorable F Unfavorable U
Sales	174800	174800	0
Variable expenses
Sales commissions	12236	12497	261 U
Advertising	12236	11777	459 F
Travel	8740	8355	385 F
Delivery	3496	3446	50 F
Total variable expenses	36708	36075	633 F
Fixed expenses
Sales salaries	35421	35421	0
Depreciation	6684	6684	0
Insurance	1298	1298	0
Total fixed expenses	43403	43403	0
Total expenses	80111	79478	633 F

1 Answer

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