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University Of New Mexico Operations And Supply Chain Management Assignment Help - Problem P1-1 Budgets


Question - Problem P1-1 Budgets in Managerial Accounting
Santiago's Salsa is in the process of preparing a production cost budget for May. Actual costs in April
were:

Santiago's Salsa
Production Cost Budget
April 2011

Production - Jars of salsa $25,000
Ingredient cost (variable) $20,000
Labor cost (variable) $12,000
Rent (fixed) $5,000
Depreciation (fixed) $6,000
Other (fixed) $1,000
Total $44,000

Required:
Part a: Using this information, prepare a budget for May. Assume that production will increase to
30,000 jars of salsa, reflecting an anticipated sales increase related to a new marketing campaign.
Part b.1: Does the budget suggest that additional workers are needed? Suppose the wage rate is $20
per hour. How many additional ...Read More

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