Budgeting and Budgetary Control793- 1,20,000 x 1.20= 1,44,000= 1,98,000 1,44,000 00 ille talor- Rs. 54,000.Total cost for 1,20,000 unitsto yaidiovTotal fixed costsDEI O00.08.1 aldertDroblem 16.7 The expenses budgeted for production of 10,000 units in a factory are furnishedbelow:Numindus non i 1qsd oonanotrisM znq e lo 19pen Per unit 8.at moldoolelicolt suntenoo of bau od ol ste tada oningoli zld tol cotamiu Rs.nbud nwolloi ortogbud imoo 70ninub boeu nd oMaterialsLabourVariable overheadsFixed overheads (Rs. 1,00,000)Variable expenses (direct)252010Selling expenses (10% fixed)0OLa Distribution expenses (20% fixed)SOBAdministration expenses (Rs. 50,000)13 nmd5Total cost of sale per unit (to make and sell)155euoil tis 00(000,1 1o ameraniPrepare a budget for production of 8,000 units and 6,000 units of showing total and per units(I.C.W.A.)cost. Assume that administration expenses are rigid for all levels of production.SOLUTIONTotal cosRsxil o oto moti dona to ziedeaAFLEXIBLE BUDGETA lapl rvn ilod n Inaoms omea bovit asal avolnalehce15008,000 units6.000 unitsT bleTotal od ingi Per unit - Totalcost000RS.) (0Ssldn Per unitcostcostcost(Rs.)(Rs.)I (Rs.)MaterialsLabourTUonljagon 5.60.00025004.20.000 dalie 70.002.00.000 00.06 25.00 00 1,50,000 Se 25.0070.00Direct expensesVariable overheadsFixed overheads40.0005.001,60,000 US 3an20.0012.5030,0001,20,0001,00,0005.0012000O000 1,00,00020.0016.67Selling expenses:n todFixed 0030.10 00 13,000 00 1.63 SI1.70000.0013,00070,2002.17VariableFixedDistribution93,600000.000,06000,0011.70expenses:FixedVariableAdministration expenses.000,E14.000 000.14,00033,6001.75O2.33Tana5.6044,8005.60(Fixed)50,0006.2550,0008.33Total00 12,75,400 0Te159.43 810,00,800166.80794Cost Accounting Principles and PracticeWorking Notes:1. Total selling expenses: 10.000 x Rs. 13 e- Rs. 1,30,000- RsFixed: 10% of Rs. 1,30,0001.000

Name: Budgeting and Budgetary Control793- 1,20,000 x 1.20= 1,44,000= 1,98,0
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Description: Budgeting and Budgetary Control793- 1,20,000 x 1.20= 1,44,000= 1,98,000 1,44,000 00 ille talor- Rs. 54,000.Total cost for 1,20,000 unitsto yaidiovTotal fixed costsDEI O00.08.1 aldertDroblem 16.7 The expenses budgeted for production of 10,000 units i

Preparation of production budget helps the business entity in determining the total cost incurred…

Business

Accounting

Problem 16.7 The expenses budgeted for production of 10,000 units in a factory are furnished below: Bo 1ogan Per unit 8.at moldo 00 ot boau od ol ste tadi ongot ald tol stami Rs.b wollo ars togbud nimos 70niub boeu d on Materials Labour Variable overheads Fixed overheads (Rs. 1,00,000) Variable expenses (direct) Selling expenses (10% fixed) Distribution expenses (20% fixed) Administration expenses (Rs. 50,000) 25 20 10 13 teno Tamen sch Total cost of sale per unit (to make and sell) 155 euoil Prepare a budget for production of 8,000 units and 6,000 units of showing total and per units cost. Assume that administration expenses are rigid for all levels of production. (I.C.W.A.)

Problem 16.7 The expenses budgeted for production of 10,000 units in a factory are furnished below: Bo 1ogan Per unit 8.at moldo 00 ot boau od ol ste tadi ongot ald tol stami Rs.b wollo ars togbud nimos 70niub boeu d on Materials Labour Variable overheads Fixed overheads (Rs. 1,00,000) Variable expenses (direct) Selling expenses (10% fixed) Distribution expenses (20% fixed) Administration expenses (Rs. 50,000) 25 20 10 13 teno Tamen sch Total cost of sale per unit (to make and sell) 155 euoil Prepare a budget for production of 8,000 units and 6,000 units of showing total and per units cost. Assume that administration expenses are rigid for all levels of production. (I.C.W.A.)

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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Concept explainers

Variance Analysis

In layman's terms, variance analysis is an analysis of a difference between planned and actual behavior. Variance analysis is mainly used by the companies to maintain a control over a business. After analyzing differences, companies find the reasons for the variance so that the necessary steps should be taken to correct that variance.

Standard Costing

The standard cost system is the expected cost per unit product manufactured and it helps in estimating the deviations and controlling them as well as fixing the selling price of the product. For example, it helps to plan the cost for the coming year on the various expenses.

Topic Video

Question

Budgeting and Budgetary Control
793
- 1,20,000 x 1.20
= 1,44,000
= 1,98,000 1,44,000 00 ille talor
- Rs. 54,000.
Total cost for 1,20,000 units
to yaidiov
Total fixed costs
DEI O00.08.1 aldert
Droblem 16.7 The expenses budgeted for production of 10,000 units in a factory are furnished
below:
Numindus non i 1qsd oonanotrisM znq e lo 19pen Per unit 8.at moldo
olelicolt suntenoo of bau od ol ste tada oningoli zld tol cotamiu Rs.nbud nwolloi or
togbud imoo 70ninub boeu nd o
Materials
Labour
Variable overheads
Fixed overheads (Rs. 1,00,000)
Variable expenses (direct)
25
20
10
Selling expenses (10% fixed)
0OLa Distribution expenses (20% fixed)
SOBAdministration expenses (Rs. 50,000)
13 nmd
5
Total cost of sale per unit (to make and sell)
155
euoil tis 00
(000,1 1o amerani
Prepare a budget for production of 8,000 units and 6,000 units of showing total and per units
(I.C.W.A.)
cost. Assume that administration expenses are rigid for all levels of production.
SOLUTION
Total cos
Rs
xil o oto moti dona to ziedeaA
FLEXIBLE BUDGET
A lapl rvn ilod n Inaoms omea bovit asal avolna
lehce
1500
8,000 units
6.000 units
T ble
Total od ingi Per unit - Total
cost
000RS.) (0S
sldn Per unit
cost
cost
cost
(Rs.)
(Rs.)I (Rs.)
Materials
Labour
TUonljagon 5.60.000
2500
4.20.000 dalie 70.00
2.00.000 00.06 25.00 00 1,50,000 Se 25.00
70.00
Direct expenses
Variable overheads
Fixed overheads
40.000
5.00
1,60,000 US 3an20.00
12.50
30,000
1,20,000
1,00,000
5.00
12000
O000 1,00,000
20.00
16.67
Selling expenses:n tod
Fixed 00
30.10 00 13,000 00 1.63 S
I1.70
000.00
13,000
70,200
2.17
Variable
Fixed
Distribution
93,600
000.0
00,06
000,00
11.70
expenses:
Fixed
Variable
Administration expenses.
000,E14.000 000.
14,000
33,600
1.75O
2.33
Tana5.60
44,800
5.60
(Fixed)
50,000
6.25
50,000
8.33
Total
00 12,75,400 0Te
159.43 8
10,00,800
166.80
794
Cost Accounting Principles and Practice
Working Notes:
1. Total selling expenses: 10.000 x Rs. 13 e
- Rs. 1,30,000
- Rs
Fixed: 10% of Rs. 1,30,000
1.000

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