Question 4. Dawn is preparing a budget for her operation. She has forecasted revenue of $1,200,000 for t budget period and now wants to complete the variable expense portion of her forecast. Dawn reviewed her historical cost percentage records. She then established her target variable cost percentages for several variable cost categories. Use Dawn's target cost percentages to comp. her variable expense forecast and then answer the questions that follow. Revenue Forecast: S1,200,000 Varlable Expense Cost Historical Variable Target Expense Percentage Expense Percentage 2.8% Expense Forecast Marketing 3.0% 36,000 Glassware 0.25 0.15 1,800 Paper products 0.25 0.25 3,000 Linens 1.0 0.75 9,000 Flowers and decorations 0.50 0.25 3,000 Kitchen utensils 0.25 0.25 3,000 1. What is the amount Dawn will budget for marketing? 2. What is the amount Dawn will budget for linens? 3. What is the amount Dawn will budget for kitchen utensils? 4. What would be the impact on marketing costs if Dawn sets that expense at 3 percent of revenue and then exceeds her forecasted revenue anmount?

FINANCIAL ACCOUNTING
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ISBN:9781259964947
Author:Libby
Publisher:Libby
Chapter1: Financial Statements And Business Decisions
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Aa v
100000 38%= 38,000
Question 4.
Dawn is preparing a budget for her operation. She has forecasted revenue of $1,200,000 for th
budget period and now wants to complete the variable expense portion of her forecast. Dawn
reviewed her historical cost percentage records. She then established her target variable cost
percentages for several variable cost categories. Use Dawn's target cost percentages to comple
her variable expense forecast and then answer the questions that follow.
Revenue Forecast: $1,200,000
Historical
Variable
Expense Cost
Variable
Target Expense
Percentage
Expense
Percentage
2.8%
Еxpense
Forecast
Marketing
3.0%
36,000
Glassware
0.25
0.15
1,800
Paper products
0.25
0,25
3,000
Linens
1.0
0.75
9,000
Flowers and
decorations
Kitchen utensils
0,50
0.25
3,000
0.25
0.25
3,000
1. What is the amount Dawn will budget for marketing?
2. What is the amount Dawn will budget for linens?
3. What is the amount Dawn will budget for kitchen utensils?
4. What would be the impact on marketing costs if Dawn sets that expense at 3 percent of
revenue and then exceeds her forecasted revenue amount?
APR
26
MacBook Air
口
Transcribed Image Text:ndow Help nework.pdf Aa v 100000 38%= 38,000 Question 4. Dawn is preparing a budget for her operation. She has forecasted revenue of $1,200,000 for th budget period and now wants to complete the variable expense portion of her forecast. Dawn reviewed her historical cost percentage records. She then established her target variable cost percentages for several variable cost categories. Use Dawn's target cost percentages to comple her variable expense forecast and then answer the questions that follow. Revenue Forecast: $1,200,000 Historical Variable Expense Cost Variable Target Expense Percentage Expense Percentage 2.8% Еxpense Forecast Marketing 3.0% 36,000 Glassware 0.25 0.15 1,800 Paper products 0.25 0,25 3,000 Linens 1.0 0.75 9,000 Flowers and decorations Kitchen utensils 0,50 0.25 3,000 0.25 0.25 3,000 1. What is the amount Dawn will budget for marketing? 2. What is the amount Dawn will budget for linens? 3. What is the amount Dawn will budget for kitchen utensils? 4. What would be the impact on marketing costs if Dawn sets that expense at 3 percent of revenue and then exceeds her forecasted revenue amount? APR 26 MacBook Air 口
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