Mama Italiano Sauce is in the process of preparing a production cost budget for
ID: 2713464 • Letter: M
Question
Mama Italiano Sauce is in the process of preparing a production cost budget for May. The actual costs in April were:
Mama Italian Sauce
Production Cost Budget
April 2008
Production - Jars of sauce
20,000
Ingredient cost (variable)
$16,000
Labor cost (variable)
9,000
Rent (fixed)
4,000
Depreciation (fixed)
6,000
Other (fixed)
1,000
Total
$36,000
Using this information, prepare a budget for May stating the total amount for the May budget. Assume the budget will increase to 26,000 jars of sauce reflecting anticipated sales increase related to a new marketing campaign
Your Answer:
Question 5 options:
Question 6 (1 point)
Consider the production cost information for Mama Italiano Sauce given below:
Mama Italian Sauce
Production Cost Budget
April 2008
Production - Jars of sauce
20,000
Ingredient cost (variable)
$16,000
Labor cost (variable)
9,000
Rent (fixed)
4,000
Depreciation (fixed)
6,000
Other (fixed)
1,000
Total
$36,000
The company is currently producing and selling jars of sauce The jars of sauce sell for $4 per jar. The company is considering lowering the price to $3.70 per jar. Suppose this action will increase sales. What is the incremental costs associated with producing an extra 57,500 jars of sauce?
Your Answer:
Consider the production cost information for Mama Italiano Sauce given below:
Mama Italiano Sauce
Production Cost Budget
April 2008
Production - Jars of sauce
20,000
Ingredient cost (variable)
$16,000
Labor cost (variable)
9,000
Rent (fixed)
4,000
Depreciation (fixed)
6,000
Other (fixed)
1,000
Total
$36,000
The company is currently producing and selling 250,000 jars of sauce annually. The jars of sauce sell for $4 per jar. The company is considering lowering the price to $3.70 per jar. Suppose this action will increase sales to 324,000 jars of sauce. What is the incremental revenue associated with the price reduction of sauce?
Your Answer:
Mama Italian Sauce
Production Cost Budget
April 2008
Production - Jars of sauce
20,000
Ingredient cost (variable)
$16,000
Labor cost (variable)
9,000
Rent (fixed)
4,000
Depreciation (fixed)
6,000
Other (fixed)
1,000
Total
$36,000
Explanation / Answer
As per Chegg Guidelines we answer one question per post. I have answered more than 1 question. Kindly post remaining questions in separate post to get the best answers Statement showing Budget for 26000 Units Particulars Amount Ingredient cost = 16000/20000*26000 20,800.00 Labour Cost = 9000/20000*26000 11,700.00 Rent 4,000.00 Depreciation 6,000.00 Other 1,000.00 Total Cost 43,500.00 Q6 Statement showing cost for 57500 Units Particulars Amount Ingredient cost = 16000/20000*57500 46,000.00 Labour Cost = 9000/20000*57500 25,875.00 Total Cost 71,875.00
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