Projected Sales, 2018 Inventories, Direct Material, And Labour Requirement
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Projected Sales |
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|
Product |
Q1 |
Q2 |
Q3 |
Q4 |
|
Azu |
6000 |
7000 |
8000 |
9000 |
|
Ranna |
5000 |
5500 |
6200 |
6800 |
|
Selling price per unit |
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|
Azu |
$ 125 |
$ 125 |
$ 135 |
$ 135 |
|
Ranna |
$ 160 |
$ 160 |
$ 170 |
$ 170 |
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2018 Inventories in sales |
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|
Product |
1st Jan 2018 |
31st Dec 2018 |
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|
Azu |
4000 |
5500 |
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|
Ranna |
3000 |
4500 |
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Uses of Direct Material |
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Amount used per unit |
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|
Direct Material |
Unit Usage |
Azu |
Ranna |
|
|
A |
KG |
4 |
5 |
|
|
B |
KG |
2 |
3 |
|
|
C |
Each |
0 |
1 |
|
|
Projected data of material |
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|
Direct Material |
Anticipated pur price |
Expected opening inventory |
Target closing inventory |
|
|
A |
$ 8.00 |
23000 |
25500 |
|
|
B |
$ 4.25 |
1900 |
1800 |
|
|
C |
$ 2.80 |
4000 |
4600 |
|
|
Direct manufacturing labour requirement |
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|
Product |
Hours per unit |
Rate per hour |
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|
Azu |
2.4 |
$ 14.55 |
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|
Ranna |
3.5 |
$ 16.75 |
Output sheet:
Sales budget:
|
Sales Budget |
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|
Product Azu |
Reference calculations |
Quarter 1 |
Quarter 2 |
Quarter 3 |
Quarter 4 |
Total |
Marks |
|
Sales |
6000 |
7000 |
8000 |
9000 |
21000 |
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|
Selling price |
$ 125 |
$ 125 |
$ 135 |
$ 135 |
$ 385 |
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|
Total sales for AZU |
a |
$ 750,000 |
$ 875,000 |
$ 1,080,000 |
$ 1,215,000 |
$ 2,705,000 |
|
|
Product Ranna |
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|
Sales |
5000 |
5500 |
6200 |
6800 |
16700 |
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|
Selling price |
$ 160 |
$ 160 |
$ 170 |
$ 170 |
$ 490 |
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|
Total sales for Ranna |
b |
$ 800,000 |
$ 880,000 |
$ 1,054,000 |
$ 1,156,000 |
$ 2,734,000 |
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|
|
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|
Total sales for both products |
|
$ 1,550,000 |
$ 1,755,000 |
$ 2,134,000 |
$ 2,371,000 |
$ 5,439,000 |
|
|
Reference for calculations |
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|
a. 6000*125 = 7,50,000 |
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b. 5000* $160 = $ 8,00,000 |
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C. 7,50,000+8,00,000 = 15,50,000 |
Production budget:
|
Production Budget (in KG) |
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|
|
|
|
|
|
Marks |
|
|
Reference calculations |
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|
|
Product Azu |
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|
Sales units |
21,000 |
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|
Less: Opening stock |
4,000 |
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ADD: Closing stock |
5,500 |
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|
Production units |
a |
22,500 |
|
|
|
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|
Product Ranna |
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|
Sales units |
16,700 |
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|
Less: Opening stock |
3,000 |
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|
ADD: Closing stock |
4,500 |
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|
Production units |
b |
18,200 |
|
|
|
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|
Total Units |
c |
40,700 |
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|
Reference for calculations |
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|
a. 21000-4000+5500 = 22,500 |
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b. 16700-3000+4500 = 18,200 |
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|
c. 22500+18200 = 40,700 |
Direct material purchase budget:
|
Direct Material purchase Budget (in KG) |
Marks |
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|
|
|
Direct Material |
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|
|
Reference calculations |
A |
B |
C |
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|
Product Azu |
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|
Production Units |
22,500 |
22,500 |
22,500 |
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|
Material Required for each Unit |
4 |
2 |
– |
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|
Total material required |
a |
90,000 |
45,000 |
– |
|
|
|
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|
Product Ranna |
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|
Production Units |
18,200 |
18,200 |
18,200 |
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|
Material Required for each Unit |
5 |
3 |
1 |
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|
Total material required |
b |
91,000 |
54,600 |
18,200 |
|
|
|
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Total material for both products |
C |
181,000 |
99,600 |
18,200 |
|
|
|
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Add: Closing stock |
25,500 |
1,800 |
4,600 |
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|
Less: Opening stock |
23,000 |
1,900 |
4,000 |
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|
Total Material purchase |
D |
183,500 |
99,500 |
18,800 |
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Reference for calculations |
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|
a. 22500*4 = 90,000 |
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b. 18200*5 = 91,000 |
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c. 90000+91000 = 1,81,000 |
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d. 181000+25500-23000 = 1,83,500 |
Direct material purchase budget:
|
Direct Material purchase Budget (in dollar) |
Marks |
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|
|
|
Direct Material |
Direct Material |
Direct Material |
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|
|
Anu |
Anu |
Total |
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Reference calculations |
A |
B |
C |
A |
B |
C |
A |
B |
C |
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|
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|
Material purchase |
90,000 |
45,000 |
– |
91,000 |
54,600 |
18,200 |
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|
Material price |
$ 8.00 |
$ 4.25 |
$ 2.80 |
$ 8.00 |
$ 4.25 |
$ 2.80 |
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|
Total material purcase amount ($) |
a |
$ 720,000 |
$ 191,250 |
$ – |
$ 728,000 |
$ 232,050 |
$ 50,960 |
$ 1,448,000 |
$ 423,300 |
$ 50,960 |
|
|
Reference for calculations |
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|
a. 90000* 8 = $ 7,20,000 |
Direct manufacturing labour budget:
|
Direct manufacturing labour budget Budget (in dollar) |
Marks |
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|
|
|
|
|
|
|
Reference calculations |
|
|
|
Product Azu |
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|
Production Units |
22,500 |
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|
Labour hour required for each unit |
a |
2.4 |
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|
Total labour hour |
54,000 |
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|
Labour rate per hour |
$ 14.55 |
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|
Total labour cost |
b |
$ 785,700 |
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|
|
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|
Product Ranna |
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|
Production Units |
18,200 |
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|
Labour hour required for each unit |
3.5 |
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|
Total labour hour |
63,700 |
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|
Labour rate per hour |
$ 16.75 |
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|
Total labour cost |
$ 1,066,975 |
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Total labour hour for both products |
c |
$ 1,852,675 |
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Reference for calculations |
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|
a. 22500*2.4 = 54,000 |
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b. 54000 * 14.55 = 7,85,700 |
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c. 785700 + 1066975 = 18,52,675 |
Budgeted finished goods inventory:
|
Budgted finished goods (in KG) |
|
|
Marks |
|
|
|
Direct Material |
|
|
|
Reference calculations |
A |
|
|
Product Azu |
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|
Closing inventory (units) |
5,500 |
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|
Direct Material |
a |
$ 222,750 |
|
|
Direct Labour |
b |
$ 192,060 |
|
|
Value of closing stock unit |
a |
$ 414,810 |
|
|
|
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|
Product Ranna |
|||
|
Closing inventory (units) |
4,500 |
||
|
Direct Material |
$ 249,975 |
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|
Direct Labour |
$ 263,813 |
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|
Value of closing stock unit |
b |
$ 513,788 |
|
|
Value of closing stock unit |
|
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|
Total closing inventory price |
c |
$ 928,598 |
|
|
Reference for calculations |
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|
a. (5500*4*8)+(5500*2*4.25) = 2,22,750 |
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b. 5500*2.4*14.5 = 1,92,060 |