Flexible Budget for Selling and Administrative Expenses for a Service Company

Digital Solutions Inc. uses flexible budgets that are based on the following data:

Sales commissions $8\%$ of sales

Advertising expense $15\%$ of sales

Miscellaneous administrative expense $$10,000$ per month plus $4\%$ of sales

Office salaries expense $$50,000$ per month

Customer support expenses $$20,000$ per month plus $30\%$ of sales

Research and development expense $$75,000$ per month

Prepare a flexible selling and administrative expenses budget for October for sales volumes of $$500,000,$ $$750,000,$ and $$1,000,000.($Use Exhibit $5$ as a model.$)$

Digital Solutions Inc.

Flexible Selling and Administrative Expenses Budget

For the Month Ending October $31$

Total sales $$500,000$ $$750,000$ $$1,000,000$

Variable cost:

Sales commissions

$Sales commissions

$Sales commissions

$Sales commissions

$-$ Select $-$

$-$ Select $-$

$-$ Select $-$

$-$ Select $-$

$-$ Select $-$

$-$ Select $-$

$-$ Select $-$

$-$ Select $-$

$-$ Select $-$

Total variable cost $fill in the blank $17$

$fill in the blank $18$

$fill in the blank $19$

Fixed cost:

$$-$ Select $-$

$$-$ Select $-$

$$-$ Select $-$

$-$ Select $-$

$-$ Select $-$

$-$ Select $-$

$-$ Select $-$

$-$ Select $-$

$-$ Select $-$

$-$ Select $-$

$-$ Select $-$

$-$ Select $-$

Total fixed cost $fill in the blank $36$

$fill in the blank $37$

$fill in the blank $38$

Total selling and administrative expenses $fill in the blank $39$

$fill in the blank $40$

$fill in the blank $41$

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