PROBLEM 1-3. Budgets in Managerial Accounting Matthew Gabon, the sales manager of Office Furniture Solutions, prepared the following budget for 2008: Sales DepartmentBudgeted Costs, 2008(Assuming Sales of $12,000,000)Salaries (fixed) $500,000 Commissions (variable) 180,000 Advertising (fixed) 100,000 Charge for office space (fixed) 2,000 Office supplies & forms (variable) 2,400 Total $784,400 After he submitted his budget, the president of Office Furniture Solutions reviewed it and recommended that advertising be increased to $120,000. Further, she wanted Matthew to assume a sales level of $13,000,000. This level of sales is to be achieved without adding to the sales force. Matthew’s sales group occupies approximately 250 square feet of office space out of total administrative office space of 20,000 square feet. The $2,000 space charge in Matthew’s budget is his share (allocated based on relative square feet) of the company’s total cost of rent, utilities, and janitorial costs for the administrative office building. Required Prepare a revised budget consistent with the president’s recommendation. PLEASE USE EXCEL WORKSHEETProblem 1-3 Office Furniture Solutions Budget prepared by the Sales ManagerSalesLess: Variable costsCommissions$180,000Office supplies & forms$2,400Total variable costsLess: Fixed…
Budgets in managerial accounting
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