ABC company produces and selling a single product. The following information relates to their budgeted operations for the 2023 financial year. Sales Period Units Quarter 1 42 000 Quarter 2 48 000 Quarter 3 33 000 A closing inventory of 15% of the next period’s sales is required. The forecast sales for Quarter 4 are 36 000 units. From the company’s history it was observed that the sales units for Quarter 4 of any year are the same. The standard material cost of one unit of finished product is: Cost per Unit produced N$ Assembly Department (N$ 8 per kilo) 24 Finishing Department (N$ 10 per kilo) 20 REQUIRED: 5.1 Prepare the Direct Material Budget, in hours and in N$, for both Departments for each of the Quarter 1
Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
ABC company produces and selling a single product. The following information relates to their budgeted operations for the 2023 financial year.
|
Sales |
Period |
Units |
|
Quarter 1 |
42 000 |
|
|
Quarter 2 |
48 000 |
|
|
Quarter 3 |
33 000 |
A closing inventory of 15% of the next period’s sales is required. The
The
|
Cost per Unit produced |
N$ |
|
Assembly Department (N$ 8 per kilo) |
24 |
|
Finishing Department (N$ 10 per kilo) |
20 |
REQUIRED:
5.1 Prepare the Direct Material Budget, in hours and in N$, for both Departments for each of the Quarter 1
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