Tough and Strong Inc.expects to sell 51,000 units of its product in the coming year.Each unit sells for $45.Sales brochures and supplies for the year are expected to cost $7,000.Three sales representatives cover the Northeast region.Each one's base salary is $25,000,and each earns a sales commission of 5 percent of the selling price of the units he or she sells.The sales representatives use their own transportation;they are reimbursed for travel at a rate of $0.40 per mile.The company estimates that the sales representatives will drive a total of 75,000 miles next year.From the information provided,calculate the company's budgeted selling expenses for the coming year.

Question

Quizplus · Accepted Answer

The budgeted selling expenses for the coming year can be calculated as follows:1. Sales brochures and supplies: $7,0002. Salaries for sales representatives: 3 representatives * $25,000 each = $75,0003. Sales commissions: 5% of (51,000 units * $45/unit) = 0.05 * $2,295,000 = $114,7504. Travel reimbursement: $0.40/mile * 75,000 miles = $30,000Total budgeted selling expenses = $7,000 + $75,000 + $114,750 + $30,000 = $226,750.