Flexy Flextime wants to review the budget using a Flexible B

Flexy Flextime wants to review the budget using a Flexible Budget. The actual sales for the period are $200,000 with a $10 per unit sales price. Sales units were budgeted for 18,000 units this period. Cost of goods sold is budgeted at $4 per unit. Selling expenses are variable at $1.50 per unit. Administrative expenses are fixed at $35,000. Calculate the actual units sold and prepare a flexible budget (hint: do not show budget vs. actual variance analysis but provide the flexible budget only).

Solution

Answer

actual unit sold = 200000 / 10

= 20000 unit

flexible budget

cost of goods sold = 20000 * 4 = 80000

selling expense = 20000 * 1.5 =30000

administrative expense =35000

total expense = 145000