udgeting and Forecasting J & J Company manufactures vaccine, a forecast of the number of doses to be sold in the first six months of 2022 is given below: Month Jan Feb Mar Apr May Jun Doses 5000 6000 10000 8000 9000 4000 It is anticipated that; There was no beginning balance on 1st January There will be no work-in-progress at the end of any month. The production manager desires to end with 700 doses in the first month and expects to increase it by 200 doses each month. The selling price per unit is anticipated at $75. Research has revealed that there is always a loss of 1.5% each month due to spoilage. Budgeted production costs estimated at $50 per dose. Required; Prepare a sales forecast budget for the six months and a production budget cost for the six months period ending 30th June 2021.
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.
Budgeting and
J & J Company manufactures vaccine, a forecast of the number of doses to be sold in the first six months of 2022 is given below:
|
Month |
Jan |
Feb |
Mar |
Apr |
May |
Jun |
|
Doses |
5000 |
6000 |
10000 |
8000 |
9000 |
4000 |
It is anticipated that;
- There was no beginning balance on 1st January
- There will be no work-in-progress at the end of any month.
- The production manager desires to end with 700 doses in the first month and expects to increase it by 200 doses each month.
- The selling price per unit is anticipated at $75. Research has revealed that there is always a loss of 1.5% each month due to spoilage.
- Budgeted production costs estimated at $50 per dose.
Required;
Prepare a sales forecast budget for the six months and a production budget cost for the six months period ending 30th June 2021.
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