Please help with the following budget question. I was not in class for the lesson and the homework is very different from the practice problems in class.

1. Prepare next year's annual budget for the quality assurance (QA) department given the following assumptions. Cost category 2019 Planning assumption basis 2019 Planning rate Salary & Wages Use the midpoint of the salary band for all job classifications Salary & Wages All salaried employees will receive a 3% increase over the standard job classification rate. (No hourly salary increase) 3% Employee Benefits Percent of wages and salaries 50% Employee Overtime Time and a half of hourly wage; OT is planned at 4% of the total hours worked (assume 2,000 work hours per employee) 4% of hourly hours worked Inflation 5% inflation 5% Depreciation No changes Plant Facilities Square feet occupied Shared service rate Telecommunications One phone per SG&A person Shared service rate Telecommunications One phone per production department Shared service rate PC workstation One PC per SG&A person Shared service rat PC workstation One PC per production department Shared service rat QA Department Manager 1 80,000-100,000 QA Supervisor 55,000-65,000 Senior QA analyst 40,000 - 50,000 Inspectors $10.00- $15.00 Support Desktop Shared Service Basis Quantity Yearly Shared Service Cost Support Desktop PC's 600 $9,000 per PC Support Telecommunications Telephones 500 $900 per telephone Office facilities Square ft 10,000 sq ft $35 per square foot Manufacturing facilities Square ft 40,000 sq ft $15 per square foot 1 | Pa. . Assume this is the first year that the company is to implement a charge for shared services Assume 2,000 available work hours per employee per year. Assume inflation impacts QA consumables . Assume a planned production level of 15,000 units for 2019 Assume the QA inspector is at 100% capacity when producing 1,250 units per month. a) Complete the 2019 budget column in the following chart: Actual Expended Budget Budget Department General Ledger Acct Projected 2018 2018 2019 Quality Assurance Salary & Wages $312,000 $310,000 Employee Benefits 156,000 155,000 Overtime 4,800 5,000 QA consumables 4,000 3,750 Depreciation 3,000 3,000 Facilities (100 sq ft W & yiElse Telecommunications 2 savolema aword yh Total HR $479,800 $476,750 D ssyolgma b) During January 2019, the actual results were as follows. Assume the actual production was 1,500 units. Prepare a January flexible budget with variances. Actual Flexed Expended Budget Flex Budget Variance Department General Ledger Acct Jan-19 Jan-19 Jan-19 Jan-19 Quality Assurance Salary & Wages $29,000 $27,295 Employee Benefits 15,000 13,648 Overtime 400 375 QA consumables 400 350 Depreciation 250 250 Facilities (100 sq ft) 125 125 Telecommunications 750 750 Total QA $46,000 $42,868 2 |Page