Course: Costs and Budget The following information is related to Company "Comercial C\&P Limited": Consider following information: - Firm has 11 hired workers, who work 8 hours a day. - It takes 4 hours to manufacture a product, therefore, each worker can make 2 products per day. - Missing products to complete demand are purchased directly from another manufacturer. - At the end of August there are 50 products in finished product warehouse. - Salary of each hired worker is $500,000 per month. - Selling price of finished product to final customer is $80,000 and cost of product purchased from other manufacturer is $50,000. Monthly fixed costs of Sales Department are: Each product manufactured also has a cost of $5,000 for raw materials. In addition, it is known that cost of transporting finished product from factory to corresponding municipality is: It is estimated that total demand will continue to grow at the same rate, i.e., it will increase by 0.5% each month from August until December. Thus, total demand in September will be 2.8%+0.5%=3.3% more than in August. Indications for the development of the work Step 1. Considering period for months of September to December: - Build the production budget, indicating how many products your workers are going to manufacture and how many you have to buy made from the other manufacturer. - It is important to keep in mind that the working days from September to December are 16, 22, 19 and 17 respectively. Step 2. Develop budget for revenues, costs and profit (assuming a 22% tax). Do not include cost of shipping to communes. Use following table to prepare budget tep 3. Estimate distribution costs from factory to communes, assuming that distribution betweer ommunes is similar to average for months of April to August. Use following tables to develor hipped products and shipping costs. Step 4. Recalculate profit, including cost of shipping to communes. Use following spreadsheet: Step 5. Indicate how much you could discount selling price of product in month of December to maintain a margin of 15%. IMPORTANT: Margin = Net Profit / Sales Revenue