Problem 11-44 Student Name:
Class:
1. Citing the benefits of flexible budgeting, explain why Susan Porter would propose using
flexible budgeting in this situation.
2.
Flexible
Budget Actual Variance
Advertising * * * *
Staff salaries * *
Sales salariesa* * * *
Commissionsb* *
Per diem expensec* * * *
Office expensesd* * * *
Shipping expensese* * * *
Total expenses * * * *
Supporting Calculations:
a Monthly salary for salesperson
Original budgeted amount *
Original # of sales people *
Additional sales people *
New budgeted amount *
b Commission Rate
Original budgeted amount *
Budgeted dollar sales *
October actual sales *
New budgeted amount *
c Per diem expense
Budgeted per diem expense *
Original # of sales people *
Additional sales people *
Travel days per person per month *
Per diem expense *
d Office expenses
Budgeted office expense *
Annual fixed office expense *
Revised Monthly Selling Expense Report for October
EduSoft Corporation
Budgeted annual orders processed *
Actual office expense *
Office expense *
e Shipping expense
Budgeted annual shipping expense *
Budgeted annual unit sales *
Variable shipping expense per unit *
Actual unit sales *
*
Problem 11-44 Student Name:
Class:
1. Citing the benefits of flexible budgeting, explain why Susan Porter would propose using
flexible budgeting in this situation.
2.
Flexible
Budget Actual Variance
Advertising 3,300,000$
*
3,320,000$
*
20,000$
*
Unfavorable
Staff salaries 250,000
*
250,000
*
–
Supporting Calculations:
a Monthly salary for salesperson
Original budgeted amount 216,000$ *
b Commission Rate
Original budgeted amount 896,000$ *
c Per diem expense
Budgeted per diem expense 297,000$ *
Original # of sales people 90
d Office expenses
Instructor
McGraw-Hill/Irwin
*
*
*
*
*
*
*
*
*
*
*
*
Budgeted annual orders processed 54,000
Actual orders processed 5,800