Flexible budget for selling and administrative expenses for a service company

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

Line Item Description	Value
Sales commissions	14% of sales
Advertising expense	18% of sales
Miscellaneous administrative expense	$5,000 per month plus 12% of sales
Office salaries expense	$30,000 per month
Customer support expenses	$13,000 per month plus 20% of sales
Research and development expense	$31,000 per month

Prepare a flexible selling and administrative expenses budget for October for sales volumes of $400,000, $500,000, and $600,000. (Use Exhibit 4 as a model.)

Line Item Description	Amount	Amount	Amount
Total sales	$400,000	$500,000	$600,000
Variable cost:
CashOffice salaries expenseSales commissionsSupplies expenseWages expense	$- Select -	$- Select -	$- Select -
Advertising expenseCashOffice salaries expenseSupplies expenseWages expense	- Select -	- Select -	- Select -
Miscellaneous administrative expenseOffice salaries expensePrepaid insuranceRent expenseWages expense	- Select -	- Select -	- Select -
Customer support expensesRent expenseResearch and development expenseSupplies expenseWages expense	- Select -	- Select -	- Select -
Total variable cost	$Total variable cost	$Total variable cost	$Total variable cost
Fixed cost:
Insurance expenseMiscellaneous administrative expenseRent expenseSupplies expenseWages expense	$- Select -	$- Select -	$- Select -
Insurance expenseOffice salaries expensePrepaid insuranceRent expenseWages expense	- Select -	- Select -	- Select -
Customer support expensesInsurance expenseRent expenseSupplies expenseWages expense	- Select -	- Select -	- Select -
Insurance expenseRent expenseResearch and development expenseSupplies expenseWages expense	- Select -	- Select -	- Select -
Total fixed cost	$Total fixed cost	$Total fixed cost	$Total fixed cost
Total selling and administrative expenses	$Total selling and administrative expenses	$Total selling and administrative expenses	$Total selling and administrative expenses