Manage budgets and forecasts

1.       Accounting Consulting provide the following information for the year ended 30 June.

 

Consulting Fees to fall by 5%                                                     Advertising to be 5% of sales

Sales commission to remain the same in total                               Sales Salaries to increase by $3000

Accounting expenses are expected to increase by 50%                  Depreciation on Motor Vehicle will be $10,000

General expenses will increase by 75%                                         Rent will increase by 20%                                                                 

Office Wages will increase by 3%

Telephones will be $25,916                                                  Superannuation will be 9% of total labour cost

Bank Charges will fall by 10%                                                                               

The Interest Rate will fall by 10%;   Workers compensation Insurance 3% of total labour cost

 

Required:  Prepare a budgeted Income Statement for next year.

2.       Just Do It Denim makes 2 different styles of jeans:

1.        701s (button fly)

2.       705s (zip fly)

 

Expected sales units are as follows:

 

Materials required are as follows:

  

Raw Materials can be purchased for the following costs:

  

Inventory Level for the Finished Goods and the Raw Materials

 

Item	Beginning Inventory	Ending Inventory
	01/01/2012	31/03/2013
701	3,000	5,000
705	2,000	3,000
Denim	22,000	28,000
Buttons	50,000	70,000
Zippers	9,500	12,000

Hours required to manufacture the jeans:

 

Product	Direct Labour Hours
701	2.0
705	1.6

 

The direct labour cost is charged at $15 per hour and direct factory overhead is costed at 25% of direct labour hours.

 

You are required to prepare the following for the quarter ending 31 March 2013:

 

1.        Sales Budget

2.       Production Budget (in units) for each product 701 and 705

3.       Materials Usage Budget (metres and each and then in dollars $)

4.       Direct Labour Budget

5.       Factory Overhead Budget

6.       Cost of Production by product and in total

7.       Cost of Goods Sold  Budget by product and in total

8.       Budgeted Trading Statement

9.       Purchases Budget (metres and each and then in dollars $) for each raw materials required to produce the jeans

 

3.     The Pogi Company Pty manufactures and sells two products, Gadget 1 and Gadget 2.  The budget department gathered the following date for the year ending 30 June 2013.

 

To produce on unit of Gadget 1 and Gadget 2, the following materials are used:

 

Projected data in respect of raw materials are as follows:

 

Projected data in respect of direct labour rates are as follows:

 

Overhead is applied at the rate of $3 per direct labour hour.

 

Required:

1.       Prepare a production budget (in units)

2.       Prepare  a raw materials purchases budget (in units and in dollars)

3.       Prepare a budget of manufacturing costs, by product and in total.