Tutorial Activity-week7

You are required to prepare from the following information

(A) Manufacturing Budget

(B) Direct Material Budget
(C) Cash Disbursement Budget

Quarter 1 Quarter 2 Quarter3 Quarter4

Budgeted unit sale 10,000 9,000 8,000 7,000

The desired ending inventory is 20% of the next quarters budgeted sales and for the 4th quarter is 1500
units. The beginning inventory is 1600 units (1st quarter).

Raw Material per unit = 3 Kg Desired ending inventory for each quarter is 15% of the following quarter
manufacturing needs & the desired ending inventory for 4thquarter is 2,240 kilogram. The opening
inventory for first quarter is 2000 kg & the Cost of raw material to be purchased $2 per unit.

Accounts Payable at the beginning of the quarter 1 were $14,850.The company is planning to pay 60%
of the raw material in the quarter acquired and rest(40%) in the following quarter