Homework SourseSPU Ltd has just received its sales expense report for Janua
SPU, Ltd., has just received its sales expense report for January, which follows.
You have been asked to develop budgeted costs for the coming year. Because this month is typical, you decide to prepare an estimated budget for a typical month in the coming year and you uncover the following additional data:
Required:
Prepare a budget for sales expenses for a typical month in the coming year. (Do not round intermediate calculations.)
| Item | Amount | |
| Sales commissions | $ | 420,500 |
| Sales staff salaries | 86,400 | |
| Telephone and mailing | 46,000 | |
| Building lease payment | 70,000 | |
| Utilities | 13,100 | |
| Packaging and delivery | 74,000 | |
| Depreciation | 34,750 | |
| Marketing consultants | 57,190 | |
| |
Solution
Calculation of Depreciation
Depreciation=Cost/Life
53000/10=$5300
| Budgeted Selling Expenses | ||||
| Item | Old | Calculations | Budgeted Typical Month | Remarks |
| Sales Commissions | 420500 | 420500*114%*90% | 431433 | Increase in Sales Volume and Decrease in Sales Price |
| Sales Staff Salaries | 86400 | 86400*108% | 89856 | Increased |
| Telephone and Mailing | 46000 | 46000*108% | 49680 | Increased |
| Buliding Lease Payment | 70000 | 70000 | 70000 | Remain Constant |
| Utilities | 13100 | 13100*103% | 13493 | Increased |
| Packing and Delivery | 74000 | 74000*114% | 84360 | Increased |
| Depreciation | 34750 | 34750+5300 | 40050 | Note |
| Marketing Consultants | 57190 | 64500 | 64500 | Given |
| Total Budgeted Costs | 801940 | 843372 |
