Fundamental Accounting Principles 22th Edition by John Wild ,Ken Shaw,Barbara Chiappetta

Exercise 7

Royal Philips Electronics of the Netherlands reports sales of €25,400 million for a recent year. Assume that the company expects sales growth of 3 percent for the next year. Also assume that selling expenses are typically 20 percent of sales, while general and administrative expenses are 4 percent of sales.
1. Compute budgeted sales for the next year.
2. Assume budgeted sales for next year is €26,000 million, and then compute budgeted selling expenses and budgeted general and administrative expenses for the next year.