Walnut has forecast sales for
Walnut has forecast sales for the next three months as follows:July 4,700 units, August 6,900 units, September 8,000 units.Walnut’s policy is to have an ending inventory of 50% of the nextmonth’s sales needs on hand. July 1 inventory is projected to be2,100 units. Selling and administrative costs are budgeted to be$16,000 per month plus $14 per unit sold. What are budgeted sellingand administrative expenses for July?
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$143,500
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$77,300
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$84,700
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$81,800
Answer:
Answer)
Calculation of budgeted selling andadministrative expenses for July
Budgeted selling andadministrative expenses = $ 16,000 + (Number of units budgeted tobe sold X $ 14 per unit)
=$ 16,000 + (4,700 units X $ 14 per unit)
= $ 16,000 + $ 65,800
=$ 81,800
Therefore Budgeted selling and administrative expensesfor July is $ 81,800.
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