The actual selling expenses incurred in March 2017 by Fallon Company are as foll

Question

The actual selling expenses incurred in March 2017 by Fallon Company are as follows.

The actual selling expenses incurred in March 2017 by Fallon Company are as follows. Variable Expenses Fixed Expenses Sales commissions Advertising Travel Delivery (a) Prepare a flexible budget performance report for March, assuming that March sales were $167,000. Variable costs and their percentage relationship to sales are sales commissions 6%, advertising 696, traveling 496 and delivery 2%. Fixed selling expenses will consist of sales salaries $35,500 Depreciation on delivery equipment $7,500, and insurance on delivery equipment $1,400. (List variable costs before fixed costs.) $10,870 Sales alaries 10,080 Depreciation 6,680 Insurance $35,500 7,500 1,400 3,450 FALLON COMPANY Selling Expense Flexible Budget Report For the Month Ended March 31, 2017 Difference Unfavorable Neither Favorable nor Unfavorable Budget Actual

Explanation / Answer

QUESTION - a

Question - b

Budget Actual Diff FAV/UNFAV Sales 167000 167000 variable expenses Sales commissions 10020 10870 850 UNFAV Advertising 10020 10080 60 UNFAV Travel 6680 6680 0 Neither Delivery 3340 3450 110 UNFAV Total 30060 31080 1020 UNFAV Fixed expenses Sales salaries 35500 35500 0 Neither Depreciation 7500 7500 0 Neither Insurance 1400 1400 0 Neither Total 44400 44400 0 Neither Total selling expense 74460 75480 1020 UNFAV

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