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Tatiana [17]
3 years ago
7

Vandel Inc. bases its selling and administrative expense budget on budgeted unit sales. The sales budget shows 5,900 units are p

lanned to be sold in April. The variable selling and administrative expense is $11.20 per unit. The budgeted fixed selling and administrative expense is $131,570 per month, which includes depreciation of $16,520 per month. The remainder of the fixed selling and administrative expense represents current cash flows. The cash disbursements for selling and administrative expenses on the April selling and administrative expense budget should be:
Business
2 answers:
Liono4ka [1.6K]3 years ago
8 0

Answer:

The correct amount of cash disbursement for the month of April is $181,130.

Explanation:

Formula for cash disbursement of selling and administrative expenses =

Sales budget in units X Variable selling and administrative expense per unit

                                   -

          Fixed selling and administrative expenses per month

                                   -

                     Depreciation per month

Given amounts -

Sales budget = 5900 units

Selling and administrative expense per unit = $11.20

Fixed selling and administrative expenses per month = $131,570

Depreciation per month = $16,520

Now putting all these values in the formula -

5900 x $11.20 + $131,570 - $16,520

= $66,080 + $115,050

= $181,130

Fantom [35]3 years ago
3 0

Answer:

Given:

Sales budget = 5,900 units

Variable selling and administrative expense = $11.20 per unit

Fixed selling and administrative expense = $131,570 per month

Depreciation = $16,520 per month

Therefore, we'll compute cash disbursements for selling and administrative expenses using the following formula:

<em>Cash disbursements = Variable selling and administrative expense × Sales budget +  Fixed selling and administrative expense - Depreciation</em>

Cash disbursements = $11.20 × 5,900 + $131,570 - $16,520

<u><em>Cash disbursements = $181,130</em></u>

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