Letts Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During January, the company budgeted for 7,000 units, but its actual level of activity was 6,970 units. The company has provided the following data concerning the formulas to be used in its budgeting:

-The selling and administrative expenses in the planning budget for January would be closest to:
A)$29,200
B)$29,884
C)$29,194
D)$30,013

Question

Letts Corporation manufactures and sells a single product. The company uses units as the measure of activity in its budgets and performance reports. During January, the company budgeted for 7,000 units, but its actual level of activity was 6,970 units. The company has provided the following data concerning the formulas to be used in its budgeting:

-The selling and administrative expenses in the planning budget for January would be closest to:

-The selling and administrative expenses in the planning budget for January would be closest to:
A)$29,200 
B)$29,884 
C)$29,194 
D)$30,013

Quizplus · Accepted Answer

The selling and administrative expenses in the planning budget are calculated based on the fixed and variable components provided in the budget. The closest value to the calculated total expenses is $29,200.

Letts Corporation Manufactures and Sells a Single Product