Assume a merchandising company uses the high-low method to separate any mixed costs into their variable and fixed elements. It provided the following income statements: May June July Sales in units 4,800 5,000 5,500 Sales $ 168,000 $ 175,000 $ 192,500 Cost of goods sold 86,400 90,000 99,000 Gross margin 81,600 85,000 93,500 Selling and administrative expenses: Advertising 17,000 17,000 17,000 Shipping 16,800 17,500 19,250 Salaries and commissions 29,600 30,000 31,000 Total selling and administrative expenses 63,400 64,500 67,250 Net operating income $ 18,200 $ 20,500 $ 26,250 What is the total estimated selling and administrative expense if the company sells 5,000 units?
Assume a merchandising company uses the high-low method to separate any mixed costs into their variable and fixed elements. It provided the following income statements: May June July Sales in units 4,800 5,000 5,500 Sales $ 168,000 $ 175,000 $ 192,500 Cost of goods sold 86,400 90,000 99,000 Gross margin 81,600 85,000 93,500 Selling and administrative expenses: Advertising 17,000 17,000 17,000 Shipping 16,800 17,500 19,250 Salaries and commissions 29,600 30,000 31,000 Total selling and administrative expenses 63,400 64,500 67,250 Net operating income $ 18,200 $ 20,500 $ 26,250 What is the total estimated selling and administrative expense if the company sells 5,000 units?
Chapter6: Activity-based, Variable, And Absorption Costing
Section: Chapter Questions
Problem 14PA: Summarized data for Walrus Co. for its first year of operations are: A. Prepare an income statement...
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Assume a merchandising company uses the high-low method to separate any mixed costs into their variable and fixed elements. It provided the following income statements:
| May | June | July | |
|---|---|---|---|
| Sales in units | 4,800 | 5,000 | 5,500 |
| Sales | $ 168,000 | $ 175,000 | $ 192,500 |
| Cost of goods sold | 86,400 | 90,000 | 99,000 |
| Gross margin | 81,600 | 85,000 | 93,500 |
| Selling and administrative expenses: | |||
| Advertising | 17,000 | 17,000 | 17,000 |
| Shipping | 16,800 | 17,500 | 19,250 |
| Salaries and commissions | 29,600 | 30,000 | 31,000 |
| Total selling and administrative expenses | 63,400 | 64,500 | 67,250 |
| Net operating income | $ 18,200 | $ 20,500 | $ 26,250 |
What is the total estimated selling and administrative expense if the company sells 5,000 units?
Garrison 17e Rechecks 2021-10-08
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