Why Choose Us?
0% AI Guarantee
Human-written only.
24/7 Support
Anytime, anywhere.
Plagiarism Free
100% Original.
Expert Tutors
Masters & PhDs.
100% Confidential
Your privacy matters.
On-Time Delivery
Never miss a deadline.
Flexible Budget for Selling and Administrative Expenses for a Service Company Morningside Technologies Inc
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 | 10% of sales |
| Advertising expense | 20% of sales |
| Miscellaneous administrative expense | $1,500 per month plus 2% of sales |
| Office salaries expense | $14,000 per month |
| Customer support expenses | $2,150 plus 3% of sales |
| Research and development expense | 3,800 per month |
Prepare a flexible selling and administrative expenses budget for April for sales volumes of $95,000, $120,000, and $145,000. Enter all amounts as positive numbers.
| Morningside Technologies Inc. | |||
| Flexible Selling and Administrative Expenses Budget | |||
| For the Month Ending April 30 | |||
| Total sales | $95,000 | $120,000 | $145,000 |
| 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 | $ | $ | $ |
2. Schedule of Cash Collections of Accounts Receivable
Furry Friends Supplies Inc., a pet wholesale supplier, was organized on May 1. Projected sales for each of the first three months of operations are as follows:
| May | $300,000 |
| June | 440,000 |
| July | 660,000 |
All sales are on account. 56 percent of sales are expected to be collected in the month of the sale, 32% in the month following the sale, and the remainder in the second month following the sale.
Prepare a schedule indicating cash collections from sales for May, June, and July.
| Furry Friends Supplies Inc. | |||
| Schedule of Collections from Sales | |||
| For the Three Months Ending May 31 | |||
| May | June | July | |
| May sales on account: | |||
| Collected in May | |||
| Collected in June | |||
| Collected in July | |||
| June sales on account: | |||
| Collected in June | |||
| Collected in July | |||
| July sales on account: | |||
| Collected in July | |||
| Total cash collected | $ | $ | $ |
Expert Solution
| 1 | Morningside Technologies Inc. | |||
| Flexible Selling and Administrative Expenses Budget | ||||
| For the Month Ending April 30 | ||||
| Total sales | $95,000 | $120,000 | $145,000 | |
| Variable cost: | ||||
| Sales commissions | 9,500 | 12,000 | 14,500 | |
| Advertising expense | 19,000 | 24,000 | 29,000 | |
| Miscellaneous administrative expense | 1,900 | 2,400 | 2,900 | |
| Customer support expenses | 2,850 | 3,600 | 4,350 | |
| Total variable cost | 33,250 | 42,000 | 50,750 | |
| Fixed cost: | ||||
| Miscellaneous administrative expense | 1,500 | 1,500 | 1,500 | |
| Office salaries expense | 14,000 | 14,000 | 14,000 | |
| Customer support expenses | 2,150 | 2,150 | 2,150 | |
| Research and development expense | 3,800 | 3,800 | 3,800 | |
| Total fixed cost | 21,450 | 21,450 | 21,450 | |
| Total selling and administrative expenses | 54,700 | 63,450 | 72,200 | |
| 2 | Furry Friends Supplies Inc. | |||
| Schedule of Collections from Sales | ||||
| For the Three Months Ending May 31 | ||||
| May | June | July | ||
| May sales on account: | ||||
| Collected in May | 168,000 | |||
| Collected in June | 96,000 | |||
| Collected in July | 36,000 | |||
| June sales on account: | ||||
| Collected in June | 246,400 | |||
| Collected in July | 140,800 | |||
| July sales on account: | ||||
| Collected in July | 369,600 | |||
| Total cash collected | 168,000 | 342,400 | 546,400 | |
Archived Solution
You have full access to this solution. To save a copy with all formatting and attachments, use the button below.
For ready-to-submit work, please order a fresh solution below.
