Kraus Company uses flexible budgets to control its selling expenses. Monthly sales are expected to be from $200,000 to $240,000. Variable costs and their percentage relationships to sales are:
Fixed selling expenses consist of sales salaries $40,000 and depreciation on delivery equipment $10,000.
Instructions
Prepare a flexible budget for increments of $20,000 of sales within the relevant range.

Question

Kraus Company uses flexible budgets to control its selling expenses. Monthly sales are expected to be from $200,000 to $240,000. Variable costs and their percentage relationships to sales are:  
Fixed selling expenses consist of sales salaries $40,000 and depreciation on delivery equipment $10,000.
Instructions
Prepare a flexible budget for increments of $20,000 of sales within the relevant range.

Quizplus · Accepted Answer

The Answer of Kraus Company uses flexible budgets to control its selling expenses. Monthly sales are expected to be from $200,000 to $240,000. Variable costs and their percentage relationships to sales are:  
Fixed selling expenses consist of sales salaries $40,000 and depreciation on delivery equipment $10,000.
Instructions
Prepare a flexible budget for increments of $20,000 of sales within the relevant range.

Kraus Company Uses Flexible Budgets to Control Its Selling Expenses