The Following Details Have Been Extracted from the Budget of a Merchandising

question 21

Multiple Choice

The following details have been extracted from the budget of a merchandising company. $$\begin{array} { | l | l | } \hline \text { Rent Expense } & \$ 8400 \text { per month } \\\hline \text { Depreciation Expense } & \$ 3500 \text { per month } \\\hline \text { Insurance Expense } & \$ 2000 \text { per month } \\\hline \text { Miscellaneous Expense } & 2 \% \text { of sales, paid as incurred } \\\hline \text { Commissions Expense } & \beta \% \text { of sales } \\\hline \text { Salaries Expense } & \$ 6000 \text { per month } \\\hline\end{array}$$ $$\begin{array} { | c | r | r | c | } \hline \text { Dec } & \text { jan } & \text { Feb } & \text { March } \\\hline \text { Sales } \$ 55,000 & \$ 60,000 & \$ 75,000 & \$ 90,000 \\\hline\end{array}$$ Commissions and salaries expenses are paid 50% in the month to which they are incurred and the balance in the next month.
Rent and miscellaneous expenses are paid as and when they occur.Insurance is prepaid at the beginning of the quarter.Calculate cash payments for the selling and administrative expenses for the first quarter of the next year.

• A) $21,100
• B) $49,200
• C) $70,300
• D) $26,200

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Definitions:

Attribution Error

A cognitive bias in which an individual incorrectly attributes the behaviors of others to inherent personality traits rather than external situations.

Consensus

A general agreement or collective unanimity among a group of people, especially in decision-making processes.

Distinctiveness

The quality of being easily distinguishable or unique compared to others.

Internal Attribution

The process of attributing the cause of a person's behavior to internal personality traits, motives, or attitudes.