Manage Budgets and financial plan

1854 WordsJan 20, 20158 Pages
Task 01 Activity A - Important Notes: According to company strategic plans, the company aims to achieve a net profit before tax of $1,000,000. The chief risks to this goal are: poor sales due to economic downturn increases in expenses such as wage expenses. In addition to Australian operations, the company is considering manufacturing overseas to take advantage of reduced costs. The company is also considering diversifying its product range to reduce exposure to poor sales of one product. Sales Information Q2 = $1 million. Q1, Q3, Q4 = Q2- 30% Commission negotiated with members of the sales team is now set at 2.5% of sales. Q2 depend on completion of 100% of repairs and maintenance. So: Q2 = 1,000,000 Q1= Q3= Q4 = 1,000,000 –…show more content…
So: FY= 77.500 Sales Centre A = 77.500 * 50% = 38.750 Sales Centre B = 77.500* 25% = 19.375 Sales Centre C = 77.500* 25% = 19.375 As the Sales Centre A expected to make 50% of total sales, the wages, telephone and office supplies should be adjust as well. As prevision on the Master Budget, I could calculate the division of Sales Centre expenses. Each quarter accounted for certain percentage: Q1 = Q3 = Q4 = 17.500/ 77.500= 22.58%. Q2= 25.000/ 77.500= 32.26% Original Sales Cost Centre expense budget Sales Centre A Sales Centre B Sales Centre C Commissions $20,000 $20,000 $20,000 Wages $100,000 $100,000 $100,000
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