DeWitt Company uses flexible budgets to control its selling expenses. Monthly sales are expected to range from$170,000 to $200,000 Variable costs and their percentage relationship to sales are:
|
Sales commissions
|
6%
|
|
Advertising
|
4%
|
|
Traveling
|
3%
|
|
Delivery
|
2%
|
|
Fixed selling expenses will consist of:
|
Sales salaries
|
$35,000
|
|
|
Depreciation on delivery equipment
|
7,000
|
|
|
Insurance on delivery equipment
|
1,000
|
Instructions
Prepare a monthly flexible budget for each $10,000 increment of sales within the relevant range for the year ending December 31, 2014.