Use the Information Below to Answer the Following Questions Other Relevant Information: Management Has Budgeted for 20,000 Direct Labour

question 14

Multiple Choice

Use the information below to answer the following questions.
Fingers Ltd, a graphic design service, has received an inquiry from a potential customer for a quotation for a webpage design. The pricing policy of the business is based on the budgeted financial data for the coming financial year. The data for the coming year is shown below: $$\begin{array} { l r } \text { Sales } & \$ 550,000 \\\text { Direct materials } & 50,000 \\\text { Direct labour } & 300,000 \\\text { Variable overhead } & 5,000 \\\text { Advertising for business } & 5,000 \\\text { Depreciation on equipment } & 30,000 \\\text { Administration } & 27,000 \\\text { Interest } & 10,000 \\\text { Profit before tax } & 133,000\end{array}$$ Other relevant information: Management has budgeted for 20,000 direct labour hours. Overhead is applied based on direct labour hours. An estimate for the direct costs of the job to be quoted on is shown below: $$\begin{array} { l r } \text { Direct materials } & \$ 400 \\\text { Direct labour (100 hours) } & \$ 1,500\end{array}$$
-Refer to the table above. Total budgeted indirect costs for the year are:

• A)$117,000.
• B)$77,000.
• C)$72,000.
• D)$57,000.

Identify sources of cash and strategies for managing short-term liabilities to optimize working capital.

Learn the benefits and risks associated with factoring receivables and how it affects a firm's finance structure.

Understand the operational effects of a company’s cash management strategies and how they influence the operating cycle.

Grasp the importance of a flexible short-term financial policy and its implications on a firm's working capital and financial stability.

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Definitions:

Key Jobs

Positions that are critical for the operation and success of a business due to their unique responsibilities or specialized skill requirements.

Pay Grade

A level or step within a compensation system that determines the pay range for employees based on their job role, skills, or experience.

Setting of Wages

The determination of how much compensation employees receive for their labor, influenced by factors such as skill level, industry standards, and economic conditions.

Job Evaluation

A systematic process for determining the value and rank of a job in an organization relative to other jobs.