Autumn Corporation Makes and Sells a Single Product Called a Security

question 135

Essay

Autumn Corporation makes and sells a single product called a Security Surge. The company is in the process of preparing its Marketing and Administrative Expense Budget for the last quarter of the year. The following budget data are available:

All of these expenses (except depreciation) are paid in cash in the month they are incurred.
Required:
a. If the company budgets to sell 22,000 Security Surges in November, what would the total budgeted marketing and administrative expenses be for November?
b. If the company budgets to sell 19,000 Security Surges in December, what would the budgeted total cash disbursements for marketing and administrative expenses be for December?
c. If the total budgeted marketing and administrative expense for October is $409,000, then how many Security Surges does the company plan to sell in October?

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Definitions:

Raw Materials Purchases

Expenditures for the acquisition of materials that are directly used in the production of goods or services.

Budgeted Cost

The estimated financial cost anticipated for a specific period, project, or operation, often used in planning and decision-making.

Cash Disbursements

Money paid out by a business during a period, including expenses, dividend payments, and investments.

Budgeted Production

The planned level of production output, defined through the budgeting process for a specific period, aiming to meet forecasted demand.