Question

Flexible Budget for Selling and Administrative Expenses for a Service Company

Morningside Technologies Inc. uses flexible budgets that are based on the following data:

Sales commissions	6% of sales
Advertising expense	24% of sales
Miscellaneous administrative expense	$1,300 per month plus 3% of sales
Office salaries expense	$12,000 per month
Customer support expenses	$1,800 plus 4% of sales
Research and development expense	4,000 per month

Prepare a flexible selling and administrative expenses budget for April for sales volumes of $80,000, $100,000, and $120,000. Enter all amounts as positive numbers.

Morningside Technologies Inc.
Flexible Selling and Administrative Expenses Budget
For the Month Ending April 30
Total sales	$80,000	$100,000	$120,000
Variable cost:
Sales commissions	$	$	$
Advertising expense
Miscellaneous administrative expense
Customer support expenses
Total variable cost	$	$	$
Fixed cost:
Miscellaneous administrative expense	$	$	$
Office salaries expense
Customer support expenses
Research and development expense
Total fixed cost	$	$	$
Total selling and administrative expenses	$	$	$

Answer 1