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 $169,000. Variable costs and their percentage relationship to sales are sales commissions 6%, advertising 6%, traveling 5%, and delivery 2%. Fixed selling expenses will consist of sales salaries $34,578, depreciation on delivery equipment $7,136, and insurance on delivery equipment $1,351. (List variable costs before fixed costs.)

Exercise 22-6 (part level submission) The actual selling expenses incurred in March 2014 by DeWitt Company are as follows. Variable Expenses Fixed Expenses Sales commissions Advertising Travel Delivery $10,977 Sales salaries 10,283 Depreciation 8,450 Insurance $34,578 7,136 1,351 3,454

Explanation / Answer

Budget Actual Difference sales 169000 169000 Variable cost sales commission 10140    [169000*.06] 10977 837 U Advertising 10140 10283 143 U Travelling 8450    [169000*.05] 8450 0 Delievery 3380    [169000*.02] 3454 74 U Total variable cost 32110 33164 1054 U Fixed cost sales salaries 34578 34578 0 depreciation 7136 7136 0 Insurance 1351 1351 0 Total fixed cost 43065 43065 0 Total cost 75175 76229 1054 u

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