Marketing programs for the upcoming year

Assignment Help Managerial Accounting
Reference no: EM13170058

As the manager of the marketing department, you are being asked for the first time to develop a department budget. The accounting department has supplied you with the following projected information about how this year, 20XX, will end up for your department's spending.

Expense category

20XX projected

Sales force base salary

200,000

Sales force commission

200,000

Sales force benefits

60,000

Trade show space rental

50,000

Free coupon expense

40,000



Note:


Sales

2,000,000

Before you begin the process, your manager and you have sat down to develop broad planning objectives for the upcoming year, which you will need to incorporate into the budget. These include a doubling of trade show spending.

an increase of the sales force by 25%.
an expected sales volume increase of 10%.
an expected increase of 4% of all expenses due to inflation.
no anticipated selling price changes for next year.
You need to do the following:
for each of the listed expenses:
identify whether you would treat them as a fixed or variable cost explain the reasoning for your classification based on the historical information and the planning you did for new marketing programs for the upcoming year, prepare a budget for the upcoming year by completing the table:

In the 20XX+1 column, fill in budgeted figures.

In the next column, when appropriate, adjust that amount for inflation. Complete the next column based on the projected volume increase.

    Expense category

    20XX projected

    20XX+1 with plan changes

    20XX+1 with inflation changes

    20XX+1 with volume impact

    Explanation

    Sales force base salary

    200,000





    Sales force commission

    200,000





    Sales force benefits

    60,000





    Trade show space rental

    50,000





    Free coupon expense

    40,000











    Note:






    Sales

    2,000,000

    2,200,000




    Reference no: EM13170058

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