BDH Corporation, which makes only one product, Kisty, has the following information available for the coming year. BDH expects sales to be 30,000 units at $50 per unit. The current inventory of Kisty is 3,000 units. BDH wants an ending inventory of 3,500 units. Each unit of Kisty takes two units of Component L. Component L is estimated to cost $12 per unit. Current inventory of L is 4,000 units. BDH wants 6,000 units of L on hand at the end of the next year. BDH pays its sales staff commission of 5% of sales. How much will be recorded on the marketing budget for sales commissions for the next period?
30,000*50*.05=75,000
To calculate the amount recorded on the marketing budget for sales commissions for the next period, we need to multiply the sales amount by the commission rate.
First, we find the total sales revenue by multiplying the number of units expected to be sold (30,000) by the selling price per unit ($50):
Total Sales Revenue = 30,000 units * $50 per unit
Total Sales Revenue = $1,500,000
Next, we calculate the sales commissions by multiplying the total sales revenue by the commission rate (5% or 0.05):
Sales Commissions = Total Sales Revenue * Commission Rate
Sales Commissions = $1,500,000 * 0.05
Sales Commissions = $75,000
Therefore, the amount recorded on the marketing budget for sales commissions for the next period will be $75,000.