The budget assumes that 60 of commission expenses are paid


Morag Manufacturing Company's budgeted income statement includes the following data:

Mar Apr May Jun   

Sales $320,000 $340,000 $360,000 $380,000   

Commission expense: 15% of sales 48,000 51,000 54,000 57,000   

Salaries expense 50,000 50,000 50,000 50,000   

Miscellaneous expense: 4% of sales 12,800 13,600 14,400 15,200   

Rent expense 4,000 4,000 4,000 4,000   

Utilities expense 2,000 2,000 2,000 2,000   

Insurance expense 2,100 2,100 2,100 2,100   

Depreciation expense 5,000 5,000 5,000 5,000

The budget assumes that 60% of commission expenses are paid in the month in which they are incurred and the remaining 40% are paid one month later. In addition, 50% of salaries expenses are paid in the month in which they are incurred, and the remaining 50% are paid one month later. Miscellaneous expenses, rent expense, and utility expenses are assumed to be paid in the same month in which they are incurred. Insurance was prepaid for the year on January 1. Prepare a schedule of cash payments for selling and administrative expenses for the quarter ending June 30.

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Financial Accounting: The budget assumes that 60 of commission expenses are paid
Reference No:- TGS01666735

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