We are a telemarketing company. Our standards is that call for $450 of sales per hour of telephone calling time. Telephone solicitors receive a commission of 10% of dollar sales, which represents an additional variable cost. We expect other variable costs, including cost of sales, to be 45% of revenue. Our fixed costs is at $411,500 per month. We compute the number of sales hours per month based on the number of days in a month minus an allowance for idle time, scheduling, and other inefficiencies. This month we expected 180 hours of telephone calling time for each of the 40 employees.
During the month, we had $2,700,000 in revenues. Marketing and administrative cost data for the month are:
Actual | Master Budget
Cost of sales 810,000 | 972,000
Phone time charges 32,200 | 32,400
Delivery services 161,100 | 194,400
Uncollectable Accts 121,500 | 145,800
Other Variable costs 112,700 | 113,400
Fixed costs 409,000 | 411,500
Q) What was our budgeted revenue? That is, what amount of revenue is included on the master budget?