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Assume the following scenario for your answers to i ) and j ) . Treat both scenarios independent of each other: Management wants to examine

Assume the following scenario for your answers to i) and j). Treat both scenarios independent of
each other:
Management wants to examine the possibility of employing the company's own sales force. The
company would need a sales manager at an annual salary of $60,000 and two sales personnel at an
annual salary of $20,000 each, plus a commission of 5% of sales. All other fixed costs, as well as
the variable cost percentages would remain the same as in the above income statement.
i) Calculate the sales dollars required for the Quarter 42023, to have the same operating
income as projected in the pro forma income statement above if the company employs its
own sales force. 6 marks
j) Calculate the required unit selling price to have the same operating income as projected in
the pro forma income statement above if the company employs its own sales force. Assume
that a change in the selling price does not affect demand for buckets. 2 marks
QUESTION II.18 MARKS
QUESTION II-Part A.8 MARKS
Montsela Company uses time-and-material pricing. The following budgeted cost data is available
for 2022:
Montsela has budgeted for 5,000 hours of technician time during the coming year. It desires a $25
profit margin per hour of labour and a 30% profit margin on parts. Montsela estimates the total
invoice cost of parts and materials in 2022 will be $200,000.
Tasks: Answer the following questions:
a) Calculate the labour charge per hour 2 marks
b) Calculate the material loading charge as percentage 2 marks
c) Montsela has received a request for a job. The company estimates that it would take 100
hours of labour time and $600 in materials. Calculate the total charge for the job. 4 marks
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