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Flexible budget for selling and administrative expenses for a service company

Digital Solutions Inc. uses flexible budgets that are based on the following data:

Line Item Description	Value
Sales commissions	15% of sales
Advertising expense	18% of sales
Miscellaneous administrative expense	$6,000 per month plus 12% of sales
Office salaries expense	$30,000 per month
Customer support expenses	$13,000 per month plus 20% of sales
Research and development expense	$32,000 per month

Prepare a flexible selling and administrative expenses budget for October for sales volumes of $400,000, $500,000, and $600,000. (Use Exhibit 4 as a model.)

Line Item Description	Amount	Amount	Amount
Total sales	$400,000	$500,000	$600,000
Variable cost:
Sales commissions	$____	$____	$____
Advertising expense	____	____	____
Miscellaneous administrative expense	____	____	____
Customer support expenses	____	____	____
Total variable cost	$____	$____	$____
Fixed cost:
Miscellaneous administrative expense	$____	$____	$____
Office salaries expense	____	____	____
Customer support expenses	____	____	____
Research and development expense	____	____	____
Total fixed cost	$____	$____	$____
Total selling and administrative expenses	$____	$____	$____

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