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 web-page 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:
$$\begin{array} { l r } \text { Sales } & \$ 550,000 \\\text { Direct materials } & 40,000 \\\text { Direct labour } & 300,000 \\\text { Variable overhead } & 5,000 \\\text { Advertising for business } & 5,000 \\\text { Depreciation on equipment } & 30,000 \\\text { Administration } & 27,000 \\\text { Interest } & 10,000 \\\text { Profit before tax } & 133,000\end{array}$$ 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 direct costs for the year are:

• A) $345,000.
• B) $340,000.
• C) $375,000.
• D) $300,000.

---

Definitions:

Company Culture

The unique combination of a company’s vision, values, norms, systems, symbols, language, assumptions, beliefs, and habits.

Flexible Working Hours

Employment terms that allow employees to vary their start and end times, promoting work-life balance.

Contract Workers

Contract workers are individuals hired by a company on a temporary basis to complete specific tasks or projects, typically without the long-term commitments or benefits associated with regular employment.

Personal Control System

Management techniques that rely on personal contact and direct supervision to oversee and control employee behavior and performance.