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hello it me again .. can you help regarding the below example from acca study hup,
Example 3 Rolling Budgets Computation
Company A has computed a 2-quarter rolling budget for the costs of one of its outlets:Labour Q1 – 3000 Q2 – 3000
The following events have occurred:
A new labour regulation has increased the minimum wage by $100 monthly for workers earning minimum wage from Quarter 2 onwards. This outlet has 3 of these workers.
answer
Labour Q2- 3900 Q3-3900
i didn’t understand base on the event how they change the labour from 3000 to 3900?
Given the initial 2-quarter rolling budget for labour costs and the new labour regulation increasing minimum wage by $100 monthly for 3 employees, the updated rolling budget for Q2 would be $3,900.
Follow these steps:
Calculate the monthly increase in labour costs:
$100/month * 3 employees = $300 per month.Calculate the quarterly increase in labour costs:
$300/month * 3 months = $900 per quarter.Update the Q2 labour budget:
$3,000 (original Q2 budget) + $900 = $3,900.
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