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3 September, 18:38

Pallen Company estimated sales of 11,000 units at $40 each, unit cost of goods sold of $22, marketing expense of $65,000 and a 10% commission on each unit sold. Administrative expense is budgeted at $50,000. What is total selling expense? A. $44,000

B. $84,000

C. $65,000

D. $109,000

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  1. 3 September, 19:26
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    D. $109,000

    Explanation:

    The total selling expense which is an element of the income statement is the sum of the marketing expense and the sales commission.

    The sales commission as given is a percentage of the number of units sold.

    Total selling expense

    = $65,000 + (10% * $40 * 11,000)

    = $65,000 + $44,000

    = $109,000
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