European Motors Ltd uses flexible budgets in order to control selling expenses. Monthly sales range from $200

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European Motors Ltd uses flexible budgets in order to control selling expenses.

Monthly sales range from $200 000 to $300 000. Budgeted fixed monthly expenses for the Sales Department are $63 000 for salaries of sales staff, $5000 for depreciation of equipment, and $12 000 for insurance. Variable expenses expressed as a percentage of sales are: training expenses for sales staff, 5%; advertising, 12%; sales commissions, 3%; and sundry selling expenses, 2%.


Required

Prepare a flexible budget using increments of $50 000 over the expected range of sales.

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Accounting

ISBN: 978-1118608227

9th edition

Authors: Lew Edwards, John Medlin, Keryn Chalmers, Andreas Hellmann, Claire Beattie, Jodie Maxfield, John Hoggett

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