E10-5 Prepare flexible manufacturing overhead budget

Fallon Company uses flexible budgets to control its selling expenses. Monthly sales are expected to range from $170,000 to $200,000. Variable costs and their percentage relationship to sales are sales commissions 6%, advertising 4%, traveling 3%, and delivery 2%. Fixed selling expenses will consist of sales salaries $35,000, depreciation on delivery equipment $7,000, and insurance on delivery equipment $1,000.

Instructions

Prepare a monthly flexible budget for each $10,000 increment of sales within the relevant range for the year ending December 31, 2017.

NOTE: Enter a number in cells requesting a value; enter either a number or a formula in cells with a "?" .

FALLON COMPANY Monthly Selling Expense Flexible Budget For the Year 2017

Activity level
Sales Revenue				$170,000		$180,000		$190,000		$200,000
Variable expenses
Sales commissions (6%)				Choose...$10,200 $12,000 $11,400 7,2007,600$10,800 8,0006,800		Choose...$10,200 $12,000 $11,400 7,2007,600$10,800 8,0006,800		Choose...$10,200 $12,000 $11,400 7,2007,600$10,800 8,0006,800		Choose...$10,200 $12,000 $11,400 7,2007,600$10,800 8,0006,800
Advertising (4%)				Choose...$10,200 $12,000 $11,400 7,2007,600$10,800 8,0006,800		Choose...$10,200 $12,000 $11,400 7,2007,600$10,800 8,0006,800		Choose...$10,200 $12,000 $11,400 7,2007,600$10,800 8,0006,800		Choose...$10,200 $12,000 $11,400 7,2007,600$10,800 8,0006,800
Traveling (3%)				Choose...4,0005,7003,4003,6005,1003,8005,4006,000		Choose...4,0005,7003,4003,6005,1003,8005,4006,000		Choose...4,0005,7003,4003,6005,1003,8005,4006,000		Choose...4,0005,7003,4003,6005,1003,8005,4006,000
Delivery (2%)				Choose...4,0005,7003,4003,6005,1003,8005,4006,000		Choose...4,0005,7003,4003,6005,1003,8005,4006,000		Choose...4,0005,7003,4003,6005,1003,8005,4006,000		Choose...4,0005,7003,4003,6005,1003,8005,4006,000
Total variable expenses (15%)				Choose...28,50030,00027,00025,500		Choose...28,50030,00027,00025,500		Choose...28,50030,00027,00025,500		Choose...28,50030,00027,00025,500
Fixed expenses
Sales salaries				Choose...$68,500 7,00035,00043,0001,000		Choose...7,0001,00043,000$70,000 35,000		Choose...35,0007,00043,000$71,500 1,000		Choose...$73,000 35,0007,0001,00043,000
Depreciation				Choose...$68,500 7,00035,00043,0001,000		Choose...7,0001,00043,000$70,000 35,000		Choose...35,0007,00043,000$71,500 1,000		Choose...$73,000 35,0007,0001,00043,000
Insurance				Choose...$68,500 7,00035,00043,0001,000		Choose...7,0001,00043,000$70,000 35,000		Choose...35,0007,00043,000$71,500 1,000		Choose...$73,000 35,0007,0001,00043,000
Total fixed expenses				Choose...$68,500 7,00035,00043,0001,000		Choose...7,0001,00043,000$70,000 35,000		Choose...35,0007,00043,000$71,500 1,000		Choose...$73,000 35,0007,0001,00043,000
Total expenses				Choose...$68,500 7,00035,00043,0001,000		Choose...7,0001,00043,000$70,000 35,000		Choose...35,0007,00043,000$71,500 1,000		Choose...$73,000 35,0007,0001,00043,000