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

Question

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

Prepare a flexible budget performance report for March, assuming that March sales were $169,900. Variable costs and their percentage relationship to sales are sales commissions 7%, advertising 6%, traveling 5%, and delivery 2%. Fixed selling expenses will consist of sales salaries $35,474, depreciation on delivery equipment $7,186, and insurance on delivery equipment $1,646. (List variable costs before fixed costs.)

Explanation / Answer

DEWITT COMPANY

SELLING EXPENSE FLEXIBLE BUDGET REPORT

FOR THE MONTH ENDED MARCH 31,2014

PARTICULARS BUDGET($) ACTUAL($) DIFFERENCE($) VARIABLE EXPENSE: SALES COMMISSION 11,893 12,741 848(U) ADVERTISING 10,194 10,295 101(U) TRAVEL 8,495 8,495 0(N) DELIVERY 3,398 3,450 52(U) FIXED EXPENSE: SALES SALARIES 35,474 35,474 0(N) DEPRECIATION 7,186 7,186 0(N) INSURANCE 1,646 1,646 0(N) 1,001(U)

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