Reference: 20_02
Julia's Candy Co. reports the following information from its sales account and sales budget:
$\begin{array}{llr}
\text { Sales } & \text { May } & \$ 105,000 \
& \text { June } & 93,000 \
& & \
\text { Expected } & \text { July } & \$ 90,000 \
\text { Sales: } & & \
& \text { August } & 110,000 \
& \text { September } & 120,000
\end{array}$
Cash sales are normally 25% of total sales and all credit sales are expected to be collected in the month following the date of sale.
-If Julia's pays sales commission of 10% each month,in addition to monthly fixed costs of $4,000,what are selling expenses for the third quarter?
A) $32,000
B) $36,000
C) $40,000
D) $44,000
E) $48,000

Question

Reference: 20_02
Julia's Candy Co. reports the following information from its sales account and sales budget:
 $\begin{array}{llr}
\text { Sales } & \text { May } & \$ 105,000 \
& \text { June } & 93,000 \
& & \
\text { Expected } & \text { July } & \$ 90,000 \
\text { Sales: } & & \
& \text { August } & 110,000 \
& \text { September } & 120,000
\end{array}$
 Cash sales are normally 25% of total sales and all credit sales are expected to be collected in the month following the date of sale.
-If Julia's pays sales commission of 10% each month,in addition to monthly fixed costs of $4,000,what are selling expenses for the third quarter?
A) $32,000
B) $36,000
C) $40,000
D) $44,000
E) $48,000

Quizplus · Accepted Answer

The selling expenses for the third quarter include the sales commission and fixed costs. The sales commission is 10% of total sales for July, August, and September: (0.10 * $90,000) + (0.10 * $110,000) + (0.10 * $120,000) = $32,000. Adding the fixed costs for three months: $4,000 * 3 = $12,000. Total selling expenses = $32,000 + $12,000 = $44,000.

Reference: 20_02 Julia's Candy Co Cash Sales Are Normally 25% of Total Sales and All

Reference: 20_02
Julia's Candy Co Cash Sales Are Normally 25% of Total Sales and All