The following budget information is available for Crescent Company for January Year 2: All operating expenses are paid in cash in the month incurred. The amount of expected cash outflow for selling and administrative expenses would be:

Question

The following budget information is available for Crescent Company for January Year 2:  All operating expenses are paid in cash in the month incurred. The amount of expected cash outflow for selling and administrative expenses would be:

Quizplus · Accepted Answer

Budgeted cash payments for selling and administrative expenses = Utilities expense + Administrative salaries + Sales commissions + Advertising + Rent on administrative building + Miscellaneous expenses
Budgeted cash payments for selling and administrative expenses = $2,500 + $100,000 + ($800,000 × 5%) + $20,000 + $60,000 + $10,000 = $232,500

The Following Budget Information Is Available for Crescent Company for January