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Budget has been defined by CIMA U. K. as, A financial and
or quantitative statement prepared prior to a defined periodof time, of the policy to be pursued during that period for the
purpose of achieving a given objective.
BUDGETARY CONTROL
Budgetary control is actually a means of control in which the
actual results are compared with the budgeted results so
that appropriate action may be taken with regard to any
deviations between the two.
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Objectives of a Budgetary Control System
1. Definition of Goals: portray with precision, the overall aims of thebusiness and determining targets of performance for each section or
department of the business.
2. Defining Responsibilities: Laying down the responsibilities of each
individual so that everyone knows what is expected from him and how
he will be judged.
3. Basis for Performance Evaluation: Providing basis for the comparison
of actual performance with the predetermined targets and investigationof deviation, if any, of actual performance and expenses from the
budgeted figures. It helps to take timely corrective measures.
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4. Optimum use of Resources: Ensuring the best use of all available
resources to maximize profit or production, subject to the limiting
factors.
5. Coordination: Coordinating the various activities of the business
and centralizing control, but also making a facility for the
Management to decentralize responsibility and delegate authority.
6. Planned action: Engendering a spirit of careful forethought,
assessment of what is possible and an attempt at it. It leads to
dynamism without recklessness. It also helps to draw up long range
plans with a fair measure of accuracy.
7. Basis for policy: Providing a basis for revision of current and
future policies.
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Advantages of Budgetary Control System
1. Maximization of Profit: The budgetary control aims at the
maximization of profits of the enterprise. To achieve this aim, a proper
planning and co-ordination of different functions is undertaken. There is
proper control over various capital and revenue expenditures. The
resources are put to the best possible use.
2. Co-ordination: The working of the different departments and sectors
is properly coordinated with budgets. The budgets of differentdepartments have a bearing on one another. The co-ordination of
various executives and subordinates is necessary for achieving budgeted
targets.
3. Specific Aims: The plans, policies and goals are decided by the topmanagement. All efforts are put together to reach the common goal of
the organization. Every department is given a target to be achieved. The
efforts are directed towards achieving some specific aims. If there is no
definite aim then the efforts will be wasted in pursuing different aims.
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4. Tool for Measuring Performance: By providing targets to
various departments, budgetary control provides a tool for measuring
managerial performance. The budgeted targets are compared to actual
results and deviations are determined. The performance of
each department is reported to the top management.This system enables the introduction of management by exception.
5. Economy: The planning of expenditure will be systematic and there
will be economy in spending. The finances will be put to optimum use.The benefits derived for the concern will ultimately extend to industry
and then to national economy. The national resources will be used
economically and wastage will be eliminated.
6. Determining Weakness: The deviations in budgeted and actual
performance will enable the determination of weak spots. Efforts are
concentrated on those aspects where performance is less than the
stipulated.
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7. Corrective Action: The management will be able to take corrective
measures whenever there is a discrepancy in performance. The
deviations will be regularly reported so that necessary action is taken at
the earliest. In the absence of a budgetary control system the deviation
can determined only at the end of the financial period.8. Consciousness: It creates budget consciousness among the
employees. By fixing targets for the employees, they are made
conscious of their responsibility. Everybody knows what he is expected
to do and he continues with his work uninterrupted.9. Reduces Costs: In the present day competitive world budgetary
control has a significant role to play. Every businessman tries to reduce
the cost of production for increasing sales. He tries to have those
combinations of products where profitability is more.
10. Introduction of Incentive Schemes: Budgetary control system also
enables the introduction of incentive schemes of remuneration. The
comparison of budgeted and actual performance will enable the use of
such schemes.
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Limitations of Budgetary Control System
1. Estimates: Budgets may or may not be true, as they are based on
estimates. The assumptions about future events may or may not
actually happen.
2. Rigidity: Budgets are considered as rigid document. Too much
emphasis on budgets may affect day to day operations and ignores the
dynamic state of organizational functioning.3. False Sense of Security: Mere budgeting cannot lead to profitability.
Budgets cannot be executed automatically. It may create a false sense of
security that everything has been taken care of in the budgets.
4. Lack of coordination: Staff cooperation is usually not available duringBudgetary Control exercise.
5. Time and Cost: The introduction and implementation of the system
may be expensive.
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Process of Budgetary Control
Budgetary control has the following stages:
A. Developing Budgets:
The first stage in budgetary control is developing various budgets. It will
be necessary to identify the budget centers in the organization and
budgets will have to develop for each one of them.
Thus budgets are developed for functions like purchase, sale,
production, manpower planning as well as for cash, capitalexpenditure, machine hours, labor hours and so on. Utmost care
should be taken while developing the budgets. The factors affecting
the planning should be studied carefully and budgets should be
developed after a thorough study of the same.B. Recording Actual Performance:
There should be a proper system of recording the actual performance
achieved. This will facilitate the comparison between the budget and
the actual. An efficient accounting and cost accounting system will help
to record the actual performance effectively.
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C. Comparison of Budgeted and Actual Performance:
One of the most important aspects of budgetary control is the
comparison between the budgeted and the actual performance.The objective of such comparison is to find out the deviation
between the two and provide the base for taking corrective action.
D. Corrective Action:
Taking appropriate corrective action on the basis of the comparisonbetween the budgeted and actual results is the essence of budgeting. A
budget is always prepared for future and hence there may be a variation
between the budgeted results and actual results. There is a need for
investigation of the same and take appropriate action so that the
deviations will not repeat in the future. Responsibilities can be fixed onproper persons so that they can be held responsible for any such
deviations
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TYPES OFBUDGETS
On the basisof TimePeriod
Long termBudget
Short termBudget
On the basisCoverage
FunctionalBudget
MasterBudget
On the basisConditions
Basic BudgetCurrentBudget
On the basisCapacity
FixedBudget
FlexibleBudget
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1. ON THE BASIS OF TIME-PERIOD
1. (I) LONG TERM BUDGETBudgets which are prepared for periods longer than a year are called
Long Term Budgets. Such Budgets are helpful in business forecasting
and forward planning. Examples: Capital Expenditure Budget and
R&D Budget.
1. (II) SHORT TERM BUDGET
Budgets which are prepared for periods less than a year are known as
Short Term Budgets. Such Budgets are prepared in cases where a
specific action has to be immediately taken to bring any variation under
control. Example: Cash Budget.
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2. ON THE BASIS OF COVERAGE
2. (I) FUNCTIONAL BUDGETS
The Functional Budgets are prepared for each function of the
organization. These budgets are normally prepared for a period
of one year and then broken down to each month. The followingbudgets are included in this category.
i. Sales Budget: A Sales budget shows forecast of expected sales in the
future period and expressed in quantity of the product to be sold as well
as the monetary value of the same. A Sales Budget may be prepared
product wise, territories/ area/ country wise, customer group wise,
salesmen wise as well as time like quarter wise, month wise, weekly etc.
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Product
Period
Product A Product B
Units Rate Amount Units Rate Amount
1stquarter
2nd quarter
3rd quarter
4th quarter
Total ------- -------- -------- --------
Sales Budget (In units & Value)
For the Budget Period ending.
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ii. Production Budget: This budget shows the production target to be
achieved in the year or the future period. The production budget is
prepared in quantity as well as in monetary terms. Before preparation ofthis budget it is necessary to study the principal budget or the key
factor. The principal budget factor can be sales demand or the
production capacity or availability of raw material. The policy of the
management regarding the inventory is also taken into consideration.
The production budget is normally prepared for a period of one year
and broken down on monthly basis.
Production targets are decided by adding the budgeted closing
inventory in the sales forecast and subtracting the opening inventory
from the total of the same. Production Cost Budget is prepared bymultiplying the production targets by the budgeted production cost per
unit.
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Product & PeriodParticulars
Product Y Product Z
Q 1 Q 2 Q 3 Q 4 Q 1 Q 2 Q 3 Q 4
A. Budgeted Sales ## ## ## ## ## ## ## ##
B. Add: Budgeted Closing
Stock of Finished goods
## ## ## ## ## ## ## ##
C. Less: Budgeted opening
stock of Finished goods
## ## ## ## ## ## ## ##
D. Budgeted Production
(A+B-C)
## ## ## ## ## ## ## ##
Production Budget (in Units)
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iii. Material Purchase Budget: This budget of materials to be purchased
during the coming year. For the preparation of this budget, production
budget is the starting point if it is the key factor. If the raw materialavailability is the key factor, it becomes the starting point. The desired
closing inventory of the raw materials is added to the requirement as
per the production budget and the opening inventory is subtracted
from the gross requirements. This budget is prepared in quantity as wellas the monetary terms and helps immensely in planning of the purchase
of raw materials. Availability of storage space, financial resources,
various levels of materials like maximum, minimum, re-order and
economic order quantity are taken into consideration while preparing
this budget. A separate material utilization budget may also be prepared
as a preparation of material purchase budget.
/
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Particulars Material X Material YA. Budgeted Usage (for production)
Product A
Product B
*******
*******
*******
*******
Total ******* *******
B. Add: Closing Stock of material ******* *******
C. Less: Opening stock of material ******* *******
D. Budgeted Purchases in units(A+B-C)
******* *******
E. Rate per unit ******* *******
F. Budgeted Purchase In Value (D*E) ******* *******
Material Purchase / Procurement Budget
For the budgeted period.
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(iv) Cash Budget: a cash budget is an estimate of cash receipts and cash
payments prepared for each month. In this budget all expected
payments, revenue as well as capital and all receipts, revenue and
capital are taken into consideration.The main purpose of cash budget is to predict the receipts and
payments in cash so that the firm will be able to find out the cash
balance at the end of the budget period. This will help the firm to know
whether there will be surplus or deficit at the end of budget period. Itwill help them to plan for either investing the surplus or raise necessary
amount to finance deficit. Cash budget is prepared in various ways, but
the most popular form of the same is by method of Receipt and
Payment method.
P ti l M th 1 M th 2 M th 3 M th 4
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Particulars Month 1 Month 2 Month 3 Month 4
Opening cash balance b/f ##
Cash receipts
Receipts from debtors
Sales of capital items
Loans received
Proceeds from share issues
Any other cash receipts
Deficit c/f ** (If balance is negative)
Cash payments
Deficit b/d ##
Payments to creditors
Wages and salaries
Loan repayments
Capital expenditure
Taxation
Dividends
Receipts less payments
Closing cash balance c/f** (If balance is positive)
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2. (II) MASTER BUDGET
All the budgets described previously are called as FunctionalBudgetsthat are prepared for the planning of individual function of the
organization. For example, Budgets are prepared for Purchase, Sales,
Production, Manpower Planning, and so on.
A master budget which is also called as Compressive Budget is a
consolidation of all the functional budgets. It shows the projected
Profit and Loss account and Balance sheet of business organization.
For preparation of this budget, all functional budget are combined
together and the relevant figures are incorporated in preparation of
the projected Profit and Loss Account and Balance Sheet. ThusMaster Budget is prepared for the organization and not for individual
functions.
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3. ON THE BASIS OF CONDITIONS
3. (I) BASIC BUDGETS: Budget, which remains unaltered over a longperiod of time, is called Basic Budget.
3. (II) CURRENT BUDGETS: A Budget, which is established for use over a
short period of time and is related to the current conditions, is calledCurrent Budget. It cover a very short period, say a month or a quarter.
They are essentially short term budgets adjusted to current conditions.
4 ON THE BASIS OF CAPACITY
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4. ON THE BASIS OF CAPACITY
4. (I) FIXED BUDGET: When a budget is prepared by assuming a fixed
percentage of capacity utilization, it is called as a fixed budget.
For example, a firm may decide to operate at 90% of its total capacityand prepare a budget showing the projected profit or loss at that
capacity. This budget is defined by The Institute of Cost and
Management Accountants of [U.K.] as the budget which is designed to
remain unchanged irrespective of the level of activity actually attained.It is based on a single level of activity.
4. (II) FLEXIBLE BUDGETS: a Flexible budget is a budget that is prepared
for different levels of capacity utilization. It can be called as a series of
fixed budgets prepared for different levels of activity. For example, a
budget can be prepared for capacity utilization levels of 50%, 60%, 70%,
80%, 90% and 100%.
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ZERO BASE BUDGET
Zero base Budgeting ( ZBB ) examines a programme or function or
responsibility from scratch. Nothing is allowed simply because it was
being done in the past. The manager proposing the activity has,therefore, to prove that the activity is essential and the various amounts
being asked for, are reasonable taking into account the volume of the
activity.
Zero Base Budgeting is method of budgeting whereby all activities are
revaluated each time budget is formulated and every item of
expenditure in the budget is fully justified. Thus the Zero Base Budgeting
involves from scratch or zero.
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Zero Base Budgeting actually emerged in the late 1960s as an
attempt to overcome the limitations of incremental budgeting. This
approach requires that all activities are justified and prioritized
before decisions are taken relating to the amount of resources
allocated to each activity. In incremental budgeting or traditional
budgeting, previous years figures are taken as base and based on
the same the budgeted figures for the next year are worked out.Thus the previous year is taken as the base for preparation of the
budget. Whereas in Zero Base Budgeting, the beginning is made
from scratch and each activity and function is reviewed thoroughly
before sanctioning the same and all expenditures are analyzed andsanctioned only if they are justified.
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Process of Zero Base Budgeting
Determination of objectives of Budgeting : The objective may be toeffect cost reduction in staff overheads or analyze and drop the
projects which do not fit in the organizational structure etc.
Determination of the extent to which ZBB is to be introduced:
Whether it is to be introduced in all areas of activities or only in a
few selected areas on a trial basis.
Development of decision units : Decision units refer to units
regarding which a cost benefit analysis will be done to decidewhether they should be allowed to continue or not. It may be a
functional department, a programme, a product line or a sub-line.
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Development of decision packages: After identification of decision
units, the manager of each decision unit reviews the activities of
his unit and examines alternative ways of accomplishing theobjectives. He does a cost benefit analysis and selects the best
alternative. He then prepares a decision packages which effectively
summarize his plans and the resources required to achieve them.
Review and ranking of decision packages: The management ranks
the decision packages in order of increasing benefit or importance
to the organization.
Preparation of Budgets: After the choice of decision package to beimplemented is made, resources are allocated to different decision
units and budgets relating to each unit are prepared.
BENEFITS FROM ZBB
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BENEFITS FROM ZBB
Benefits from ZBB can be summarized as follows:
i. ZBB facilitates review of various activities right from the scratch and a
detailed cost benefit study is conducted for each activity. Thus an
activity is continued only if the cost benefit study is favorable. Thisensures that an activity will not be continued merely because it was
conducted in the previous year.
ii. A detailed cost benefit analysis result in efficient allocation of
resources and consequently wastages and obsolescence is eliminated.iii. A lot of brainstorming is required for evaluating cost and benefits
arising from an activity and this results into generation of new ideas and
also a sense of involvement of the staff.
iv. ZBB facilitates improvement in communication and coordination
amongst the staff.
v. Awareness amongst the managers about the input costs is created
which helps the organization to become cost conscious.
vi. An exhaustive documentation is necessary for the implementation of
this system and it automatically leads to record building.
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LIMITATIONS OF ZERO BASE BUDGETING
The following are the limitations of Zero Base Budgeting:i. It is very detailed procedure and naturally is time consuming and lot of
paper work is involved in the same.
ii. Cost involved in preparation and implementation of this system is
very high.iii. Morale of staff may be very low as they might feel threatened if a
particular activity is discontinued.
iv. Ranking of activities and decision-making may become subjective at
times.
v. It may not advisable to apply this method when there are nonfinancial considerations, such as ethical and social responsibility because
this dictate rejecting a budget claim on low ranking projects.
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Performance Budgeting
Performance budgeting is a relatively new concept which focuses on
functions, programmes and activities. Performance budgets areestablished in such a manner that each item of expenditure related to a
specific responsibility centre is closely linked with the performance of
that centre.
Performance budgeting involves evaluation of the performance of the
organization in the context of both specific as well as overall
objectives of the organization.
According to the National Institute of Bank Management, performance
budgeting technique is, the process ofanalyzing, identifying,
simplifying and crystallizing specific performance objectives of a job tobe achieved over a period in the framework of the organizational
objectives, the purpose and objectives of the job. The technique is
characterized by its specific direction towards the business objectives of
the organization.
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Thus, performance budgeting lays immediate stress on the achievement
of specific goals over a period of time. However, in the long-run it aims
at continuous growth of the organization so that it continues to meet
the dynamic needs of its growing clientele. It enables the organizationto be sensitive and adaptive, preventing it from developing rigidities
which may slow down the process of growth.
The main features of performance budgeting are as follows:i. Classification into functions, programs or activities
ii. Specification of objectives for each program
iii. Establishing suitable methods for measurement of work as far as
possible
iv. Fixation of work targets for each program.
CASH BUDGET
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1. From the following information prepare a monthly Cash- Budget for the four months ending
31st December 2011.
Expected Sales:
September 50,000
October 60,000
November 45,000
December 80,000
Expected Purchase:
September 32,000
October 60,000
November 70,000
December 45,000
Other relevant information is:
Wages to be paid to workers Rs. 6,000 each month.
Dividend from investment amounting to Rs. 1,000 is expected on 31st December 11.
Income tax to be paid in advance in December Rs. 2,000.
Preference share dividend of Rs. 5,000 is to be paid on 30th November.
Balance at Bank on 1st September is expected to Rs. 6,000.
2 From the following particulars make out a Cash-Budget of Luxury Ltd for October to Decembe
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2. From the following particulars make out a Cash-Budget of Luxury Ltd. for October to Decembe
Month Sales Purchase Wages
Actual Figures
July 3,00,000 1,00,000 60,000
August 3,50,000 1,50,000 70,000
September 4,00,000 2,00,000 64,000
Budgeted
October 6,00,000 3,00,000 80,000
November 4,50,000 2,50,000 72,000December 5,00,000 2,00,000 60,000
Other information:
Credit allowed to customer is 2 months and credit allowed by creditor is 1 month.
Time lag in payment of wages and expenses is of a month.
Advance tax is to be paid in November Rs. 25,000.Insurance Rs. 5,000 payable every month which is not included in the above wages and
expenses.
Machinery purchased in December amounted to Rs. 1,50,000.
10% of sales and purchase are made for cash.
Selling commission is payable @ 5% on sales, payable in the month following the month of
collection.The bank balance on 1st October is 1,00,000.
3 Prepare a Cash-Budget for the three months ending 30th June 2011 from the
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3. Prepare a Cash Budget for the three months ending 30 June, 2011 from the
information given below:
(a) Month Sales Materials Wages Overheads
February 14,000 9,600 3,000 1,700
March 15,000 9,000 3,000 1,900April 16,000 9,200 3,200 2,000
May 17,000 10,000 3,600 2,200
June 18,000 10,400 4,000 2,300
(b) Credit terms are:
Sales & Debtors- 10% sales are on cash, 50% of the credit sales are collected next
month and the balance in the following month.
Creditors- Materials 2 months
Wages months
Overhead month
( c) Cash and bank balance on 1st April 2011 is expected to be Rs. 6,000.(d) Other relevant informations are:
Plant & machinery will be installed in February 2011 at a cost of Rs. 96,000. The
monthly installment of Rs. 2,000 is payable from April onwards.
Dividend @ 5% on preference share capital of Rs. 2,00,000 will be paid on 1st June.
Dividend from investment amounting to Rs. 1,000 is expected to be received in June.Advance income tax to be paid in June is Rs. 2,000.
4 From the following information supplied by Bright Ltd Prepare a cash budget for the
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4. From the following information supplied by Bright Ltd. Prepare a cash budget for the
Period From 1st September 2011 to 31st December 2011:
MonthsCredit
Purchase
Credit
Sales WagesSelling
Expenses Overheads
July 85,000 1,60,000 32,000 8,000 10,000
August 92,000 1,85,000 37,000 9,500 11,500
September 1,00,000 2,10,000 42,000 10,500 13,000
October 1,20,000 2,45,000 49,000 12,500 14,500November 90,000 1,82,000 36,000 9,000 11,000
Additional Information:
Expected cash balance on 1st September is Rs. 10,500.
Period of credit allowed to debtors is 2 months.
Period of credit allowed by creditors is 1 month. Time lag in payment of wages, selling expenses and overhead is 1 month.
Selling commission @ 2% on sales is payable 1 month after sales.
Expenditure on machinery worth Rs. 50,000 is payable in October.
Expected cash sales per month Rs. 15,000. No commission is payable on cash sales.
5. Following information is available from the record of Jay Ltd. for the year end 31st Dec 2011.
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g y y
Rs. (Lakhs)
Fixed Expenses
Wages & Salaries 9.5
Rent, Rates and Taxes 6.6
Depreciation 7.4
Sundry expenses 6.5
Semi-Variable expenses (50% capacity)
Maintenance & Repairs 3.5
Indirect Labour 7.9
Sales department salaries 3.8
Sundry expenses 2.8
Variable Expenses (50% capacity)Material 21.7
Labour 20.4
other Expenses 7.9
Total 98.0Assuming that fixed expenses remain constant for all levels of production, Semi variable expenses remain
constant between 45% and 65% of capacity, increasing by 10% if capacity exceeds 65%but does not exceed
85% of capacity and by 20% if capacity exceeds 85%.Sales at various levels are:50% capacity 100 Lakhs
60% capacity 120 Lakhs
75% capacity 150 Lakhs
90% capacity 180 Lakhs
100% capacity 200 Lakhs
Prepare a flexible budget for the year and forecast the profit at 60%, 75%, 90%, 100% of capacity.
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6. Prepare flexible budget for the production at 80% and 100%activity on the basis of the following information:
Production at 50% capacity:- 5,000 units of raw material @
Rs. 80 per units, Direct Labour @ Rs. 50 per unit, Direct
expenses Rs. 15 per unit, Factory expenses Rs. 50,000 (50%variable), Administrative expenses Rs. 60,000 (40% fixed).
MATERIAL PURCHASE / PROCUREMENT BUDGET
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MATERIAL PURCHASE / PROCUREMENT BUDGET
7. The Sales Manager of Delhi Mills Company expected to sale 25,000 units of a
particular product next year. The Production Manager consulted the storekeeper who
gave the necessary detail as follows:
Two kinds of raw material, P and Q required for manufacturing the product. Each unit
of the product requires 2 unit of P and 3 unit of Q. The estimated opening balances atthe commencement of the next year are:
Units
Finished Product
5,000
Raw Material P 6,000
Raw Material Q 7,500The desirable closing balances at the end of the next year are:
Units
Finished Product 7,000
Raw Material P 6,500
Raw Material Q 8,000
Let us prepare a statement showing material purchase budget for the next year.
8 The sales and production budgets for a glass manufacturing company
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8. The sales and production budgets for a glass manufacturing company
are given below. It is now the end of January, during which actual sales
were 44,000 units. The sales manager expects the sales for each of the
remaining months of the year to be 25% higher than originally budgeted.
He wishes to increases production to take advantage of the higherdemand. The firm has a policy of keeping inventory equal to budgeted
sales for the following two months. Actual production in January was
56,000 units and the beginning inventory was 88,000 units. The budgeted
data based on previous estimates is given below:
Particulars January February March April May June
Budgeted Sales 40,000 48,000 56,000 60,000 56,000 52,000
Budgeted Production 56,000 60,000 56,000 52,000 48,000 nil
Prepare modified sales budgets and production budget.
9. A glass manufacturing company requires you to calculate and present the budgeted
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g g p y q y p g
Income-Statement for the year from the following information:
Sales
Toughened glass Rs. 3,00,000
Bent toughened glass Rs. 5,00,000
Direct material cost 60% of sales
Direct Wages 20 workers @ 150/month
Factory Overheads
Work manager salary Rs. 500/monthForeman Rs. 400/month
Stores & spares 2.5% on sales
Depreciation on machinery Rs.12,600
Light and Power Rs. 5,000Repairs & Maintenance Rs. 8,000
Other sundries 10% 0n direct wages
Administration, selling & distribution expenses 14,000 per year
10. Z Ltd. provides you the following information:
Balance-sheet (31-3-2011)
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Balance sheet (31 3 2011)
Liabilities Amount Assets Amount
Share Capital 4,00,000 Plant & Machinery
Retained Earnings 32,000 Original Cost 4,00,000
Creditors 10,000 Less: Depreciation 1,00,000 3,00,000
Bills payable 6,000 Stock of Raw Material 38,000
Provision for taxation 20,000 Stock of Finished goods 80,000
Debtors 20,000
Bills Receivable 10,000
Cash 20,000
4,68,000 4,68,000
1 Purchase of machinery during 2011-12 40,000
2 Outstanding Debtors 46,000
3 Outstanding Creditors 11,000
4 Credit Sales 4,40,000
5 Credit Purchase 1,40,000
6 Closing stock of raw material 52,000
7 Closing stock of finished goods 66,900
8 Direct labour consumed and paid 70,000
9 Factory overheads (Including depreciation for Rs 20,000) 95,000
10 Administrative, Selling & distribution overheads 60,300
11 Income tax is levied @ 50% and paid in the following year
12 Re bills receivable:
(i) To be drawn 4,000(ii) To be endorsed to trade creditors 1,000
(iii) To be collected 10,000
13 Re bills payables
(i) To be accepted 5,000
(ii) To be discharged 7,000
14 Budgeted profit fo 2011-12 75,600
15 Income tax to be provided @ 50%
R i d P C h B d t d B d t d B l Sh t
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