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 $14\%$ of sales

Advertising expense $18\%$ of sales

Miscellaneous administrative expense $$5,000$ per month plus $12\%$ of sales

Office salaries expense $$29,000$ 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 $5$ as a model.$)$

Digital Solutions Inc.

Flexible Selling and Administrative Expenses Budget

For the Month Ending October $31$

Total sales $$400,000$ $$500,000$ $$600,000$

Variable cost:

$$-$ Select $-$ $$-$ Select $-$ $$-$ Select $-$

$-$ 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 $41$