Practice Question
If a company has a budget for selling and administrative expenses of $200,000 and expects a 5% increase, what will the new budget be?
Answer +
Correct Answer: $210,000
Explanation +
New Budget = Current Budget × (1 + Increase Percentage) = $200,000 × (1 + 0.05) = $210,000.
This is important for budget forecasting (Page 51).