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The Keller Company uses flexible budgets to control its selling expenses. Monthly sales are expected...

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Question

Accounting

The Keller Company uses flexible budgets to control its selling expenses. Monthly sales are expected to be from $200,000 to $240,000. Variable costs and their percentage relationships to sales are:

Sales commissions 7%

Advertising 4%

Traveling 6%

Delivery 1%

Fixed selling expenses consist of Sales Salaries $40,000 and Depreciation on Delivery Equipment $10,000.

The actual selling expenses incurred in February 2017, by Keller Company are as follows:

Sales commissions $15,700

Advertising 8,000

Travelling 13,300

Delivery 1,600

Actual fixed selling expenses consisted of Sales Salaries of $41,500 and Depreciation on Delivery Equipment of $10,000.

Instructions

please make a flexible budget performance report, assuming that February sales were $220,000. Expected and actual sales are the same.

Please follow the format below:

KELLER COMPANY

Selling Expense Budget Report (Flexible)

Month ended February 28, 2017

Difference

Activity level Favorable F

Expected $220,000 Budget Actual Unfavorable U

Actual 220,000 $220,000 $220,000

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