Lawson Company combines its operating expenses for budget purposes in a selling and administrative expense budget. For the first quarter of 2014, the following data are developed:

1. Sales: 20,000 units; unit selling price: $30

2. Variable costs per dollar of sales:

Sales commissions 7%

Delivery expense 1%

Advertising 5%

3. Fixed costs per quarter:

Sales salaries $25,000

Office salaries 16,000

Depreciation 5,000

Insurance 2,000

Utilities 1,000

INSTRUCTIONS

Prepare a selling and administrative expense budget for the first quarter of 2014.