Kapital Ltd Has Prepared the Operating Budget for the First

question 143

Multiple Choice

Kapital Ltd has prepared the operating budget for the first quarter of 2017.The company forecasts sales of $50,000 in January,$60,000 in February and $70,000 in March.Variable and fixed expenses are as follows:
Variable: electricity cost (40% of sales)
Miscellaneous expenses: (10% of sales)
Fixed: salary expense: $8000 per month
Rent expense: $4000 per month
Depreciation expense: $1200 per month
Electricity cost/fixed portion: $800 per month
Miscellaneous expenses/fixed portion: $1200 per month
Calculate total operating expenses for the month of January.

• A) $40,200
• B) $25,000
• C) $50,200
• D) $45,200

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