Argyle Company Is Preparing the Operating Budget for the First

question 74

Multiple Choice

Argyle Company is preparing the operating budget for the first quarter of 2013. They forecast sales of $50 000 in January, $60 000 in February, and $70 000 in March. Variable and fixed expenses are as follows:
Variable: Power cost (40% of Sales)
Miscellaneous expenses (5% of Sales)
Fixed: Salary expense: $8 000 per month Rent expense: $5 000 per month
Depreciation expense: $1 200 per month Power cost/fixed portion: $800 per month
Miscellaneous expenses/fixed portion: $1 000 per month
How much is the total operating expense for January?

• A)$47 500
• B)$43 000
• C)$41 700
• D)$38 500

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Definitions:

Bar Chart

A graphical representation using bars to show comparisons among categories or variables.

Sales Revenues

The income received from selling goods or services over a period of time before any costs or expenses are deducted.

Points of Difference

Unique attributes or benefits of a product or brand that set it apart from competitors in the eyes of customers.

High-Quality

The standard of something as measured against other things of a similar kind; the degree of excellence of something.