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Exercise 10-5 Fallon Company uses flexible budgets to control its selling expenses. Monthly sales are expected to range from $166,900 to $198,400. Variable costs and
Exercise 10-5 Fallon Company uses flexible budgets to control its selling expenses. Monthly sales are expected to range from $166,900 to $198,400. Variable costs and their percentage relationship to sales are sales commissions 6%, advertising 5%, traveling 4%, and delivery 2%. Fixed selling expenses will consist of sales salaries $35,300, depreciation on delivery equipment $6,600, and insurance on delivery equipment $1,000 Prepare a monthly flexible budget for each $10,500 increment of sales within the relevant range for the year ending December 31, 2017. (List variable costs before fixed costs.)
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