Reference no: EM133377083

Select a process to develop the Expenses Account to make a budget for a year with the following accounts: 

1. Direct Labor (Use a minimum of two operational positions)
2. Direct Materials (Use a minimum of five materials)
3. Overhead (Indirect Labor - Use a minimum of 5 positions)
4. Overhead (Indirect Accounts)

• -Maintenance, Repair, and Operations (MRO)
• Utilities (Energy, Water, Internet, and Communications)
• Depreciation (For the equipment of the alternatives) Professional Services (One contracted position)
• Traveling and Training (An estimated figure)
• Sales and Distribution (Estimate cost for sales samples, sales operations, and distribution of the product in the market)

5. Estimate Actual Costs using the budget figures as a base. 

6. Determine the unit cost for the budget and actual figures.

7. Develop the unit cost variances Pick two with the worst variances and develop one productivity alternative per variance, including the acquisition of equipment.

8. Determine the total investment cost and savings per alternative. Determine the depreciation of the equipment and use it in the budget and actual. 

9. Determine the justification for both alternatives and select those with IRR over the target of 33%. 

10. Develop a new budget with the savings included as an Adjusted Budget.