Kraus Company Uses Flexible Budgets to Control Its Selling Expenses

Kraus Company uses flexible budgets to control its selling expenses. Monthly sales are expected to be from $200,000 to $240,000. Variable costs and their percentage relationships to sales are:
Fixed selling expenses consist of sales salaries $40,000 and depreciation on delivery equipment $10,000.
The actual selling expenses incurred in February, 2010, by Molle Company are as follows:
Fixed selling expenses consist of sales salaries $41,000 and depreciation on delivery equipment $10,000.
Instructions
Prepare a flexible budget performance report, assuming that February sales were $220,000.

Correct Answer:

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