Question
need help with the wording of a response. Q- Restructure the remuneration packages of staff in the sales division. It is proposed to increase the
need help with the wording of a response.
Q- Restructure the remuneration packages of staff in the sales division. It is proposed to increase the sales commission paid to salespersons by 3%. It is expected that the additional incentive available to the sales staff will increase table sales by 5%
Proposed answer - Lastly, with this new change, the Total Sales Revenue Budget will amount to an inclination of $159,500, and additionally resulting in an increase of $108,460 in Total Selling and Admin Costs. Subsequently, Fantastic Ltd. would be gaining an additional $51,040, which seems to be a favourable outcome, however, similar to the first scenario, it would not actually benefit the business by increasing the units sold as COGS is higher than the unit selling price. So, if Fantastic Ltd. decide to implement this policy, they should only do so after a price increase.
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