1. Flexible Budget for Selling and Administrative Expenses for a Service Company Digital Solutions Inc. uses...

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1. Flexible Budget for Selling and Administrative Expenses for a Service Company Digital Solutions Inc. uses flexible budgets that are based on the following data: 8% of sales 15% of sales Sales commissions Advertising expense 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.) DigitalS Colter Manufacturing Company Assembly Department Budget For the Year Ending July 31, 20Y8 Level 2 9.000 1. 2 3 4 Level 1 8,000 Level 3 10,000 5 Units of production 6 Variable cost: Direct labor ($5 per unit) Electric power ($0.50 per unit) Total variable cost Step 1 7. $40,000 $45,000 4,500 $44,000 $49,500 $55,000 $50,000 5,000 8 4,000 Step 2 9 10 Fixed cost: Electric power Supervisor salaries 11 $ 1,000 $ 1,000 $ 1,000 15,000 $16,000 $71,000 15,000 15,000 13 Total fixed cost $16,000 $16,000 14 Total department costs 15 $60,000 $65.500 Step 3 234 5 1. Flexible Budget for Selling and Administrative Expenses for a Service Company Digital Solutions Inc. uses flexible budgets that are based on the following data: 8% of sales 15% of sales Sales commissions Advertising expense 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.) DigitalS Colter Manufacturing Company Assembly Department Budget For the Year Ending July 31, 20Y8 Level 2 9.000 1. 2 3 4 Level 1 8,000 Level 3 10,000 5 Units of production 6 Variable cost: Direct labor ($5 per unit) Electric power ($0.50 per unit) Total variable cost Step 1 7. $40,000 $45,000 4,500 $44,000 $49,500 $55,000 $50,000 5,000 8 4,000 Step 2 9 10 Fixed cost: Electric power Supervisor salaries 11 $ 1,000 $ 1,000 $ 1,000 15,000 $16,000 $71,000 15,000 15,000 13 Total fixed cost $16,000 $16,000 14 Total department costs 15 $60,000 $65.500 Step 3 234 5

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