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Selling and Administrataive Expense Budget

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The budgeted unit sales of Hearve Company for the upcoming fiscal year are provided below:

1st QTR 2nd QTR 3rd QTR 4th QTR
Budgeted unit sales: 12,000 14,000 11,000 10,000

The company's variable selling and administrative expenses per unit are $2.75. Fixed selling and administrative expenses include advertising expenses of $12,000 per quarter, executive salaries of $40,000 per quarter, and depreciation of $16,000 per quarter. In addition, the company will make insurance payments of $6,000 in the 2nd quarter and $6,000 in the 4th quarter. Finally, property taxes of $6,000 will be paid in the 3rd quarter.

Prepare the company's selling and administrative expense budget for the upcoming fiscal year.

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Solution Summary

Provides steps necessary to prepare the company's selling and administrative expense budget.

Solution provided by:
Gaurav Agarwal, MS
Education
  • BE, Bangalore University, India
  • MS, University of Wisconsin-Madison
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