The selling and administrative expense budget of Choo Corporation is based on bu

Question

The selling and administrative expense budget of Choo Corporation is based on budgeted unit sales, which are 4,600 units for August. The variable selling and administrative expense is $7.30 per unit. The budgeted fixed selling and administrative expense is $51,980 per month, which includes depreciation of $6,440 per month. The remainder of the fixed selling and administrative expense represents current cash flows. The cash disbursements for selling and administrative expenses on the August selling and administrative expense budget should be:

$45,540

$85,560

$79,120

$33,580

Explanation / Answer

Total variable selling and administrative expense(7.3*4600) $33580 Total fixed selling and administrative expense($51980-6440) 45540 Total cash disbursements for selling and administrative expenses $79120.

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