Asked by
Isabel nishimoto
on Dec 16, 2024
Verified
Comma Co. makes and sells widgets. The company is in the process of preparing its selling and administrative expense budget for the month. The following budget data are available: Variable Cost Per Unit SoldMonthly Fixed Cost Sales commissions $1$10,000 Shipping $3 Advertising $4 Executive salaries $120,000 Depreciation on office equipment $4,000 Other $2$6,000\begin{array}{lcc}&\text {Variable Cost Per Unit Sold}&\text {Monthly Fixed Cost}\\\text { Sales commissions } & \$1& \$10,000 \\\text { Shipping } & \$3 & \\\text { Advertising } &\$4& \\\text { Executive salaries } & &\$120,000 \\\text { Depreciation on office equipment } & & \$4,000\\\text { Other }&\$2& \$6,000\end{array} Sales commissions Shipping Advertising Executive salaries Depreciation on office equipment Other Variable Cost Per Unit Sold$1$3$4$2Monthly Fixed Cost$10,000$120,000$4,000$6,000 Expenses are paid in the month incurred. If the company has budgeted to sell 80000 widgets in October how much is the total budgeted selling and administrative expenses for October?
A) $940000
B) $140000
C) $930000
D) $800000
Administrative Expense
Costs associated with the general administration of a business, including salaries of senior executives, legal and financial fees, and other general expenses.
Fixed Cost
Overheads that are not affected by the volume of production or sales, covering rent, employee salaries, and insurance fees.
- Gain an understanding of the components and calculations necessary for developing a selling and administrative expense budget.
Verified Answer
RC
Learning Objectives
- Gain an understanding of the components and calculations necessary for developing a selling and administrative expense budget.