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    Master Budget

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    Master Budget

    Copyright:

    © All Rights Reserved
    Download as PDF or read online from Scribd
    Flag for inappropriate content
    49 views48 pages

    BUD Master Budget

    Uploaded by

    Aniket Vyas
    Master Budget

    Copyright:

    © All Rights Reserved
    Download as PDF or read online from Scribd
    Flag for inappropriate content
    of 48
    aael & ver- Il: frac Ud Wet Te (Types of Budgets-II : Functional and Master Budget) Glen A aed Gran & faq ase saga e-seT Fan Pea ora Eee awe te ‘awe tit @ Brad feet fase fire & fore sna aver cae a Pate farsa 2 staat Teretfara at Retin fear sre B1! ae ase set staf Ft feersil wt Praia ae 21 fearers ase &t eat F aera Sra (1) araters on freer oer : gad ase stale fol fa oA are arse Al water ait 2 auig get deen & fats feria os fates salt a heal a are feareert ar Sees ele 81 saree & fare, Pret sear F seare—Afrat (Product Lines) & Sea wt ase ART ST aaa 2 rae wees Sere A TeTfsa aT a cag a Sect| ear sre 21 (2) sweetest ave : gad den & Ra are & fee wets cafes & oes ar Rater ‘far arat 8 1 et weet 4, aac rise ere F feea-fee alee aa ease SeReTRaa 21a we are ase Patsa-ser eter 2, sah sofas sae Faa-geM eae fener or aera ase F A veer & ase aaa Td Be (1) faa as (Sales Budget) (2) Scare Ase (Production Budget) - (3) Ta ase (Cost Budget) » @ «SAA eT Fe (Cost of Production Budget) e@ arnt cra ase (Material Cost Budget) e@ 94 Md Ase (Labour Cost Budget) e@ seed Baer ase (Production Overhead Budget) © daa svi ase (Plant Utilisation Budget) (i) SeTeR TIMTA aH (Administration Cost Budget) Gil) fara wa fea TA Tse (Selling and Distribution Cost Budget) (iv) aha wd fare Ase (Research and Development Budget) 1. I.C.MA. Terminology, London. aorel wame-H1 2 PATCH Te ATER ae (4) fata aa (Financial Budget) (i) fata era ase (Financi (ii) tS ATE (Cash Budg (ii) Yftra sa aE (Capital Expenditure Budget) seat weer 8 aret Fara, Serres ae era are 3 ara cht Falke aor ferega feraaH xq Expenditure Budget) aera 4 cen five ase er are steava # fee aT 81 fama ase (Sales Budget) fisna awe gor ferht ar qaigaa @ Bra wat oitk/ stern aren B ora fret ot wa 21 Saen Fara A ase geet tan Par are 8 sik are I gO yar A ahaa fase sire 81 feta ave GaN aT aaitts Aeepl awe wit 3 sais ora art ase fase ase we aTenfea aa 8) Sareea, FRAT ATA HT SGATA CATA SH UATE Gt Sea are ae Fs AT Tepe BST: eh arta ase Pic aed @ | get are aare Stat A dens safe SgH of fae ase ae eke aa & | sam & ara fag (Points to be Considered) fase ase Sar al Sataifara fasne wares ar eter 2 | eae ga al § sa aare sifted, en fm wd ead & fe atard weal aed 21 foes sae a fee agar era ema fie al a eam 4 ce afer (1) (2) (3) (4) (s) (6) (7) a figsa & 7a attest an faectann : faaea qatgan tan ae & fee ae gw aul & fash sid ord a Sas faero @ set At rar veh are at eet cafea | yatga dan ae & feu nd af Al ase fash a arediae fash ais sath ald &1 am facta : gaa stxa weafad aig, soe feosrea, wfterat ft aearen, yea ont Sant § oranda aor 2 | ae ae deer SH era ae Sea ST Gea 8 HAT ATS fag ate Gears Ht Sard Fea we ofl oT Ba 81 fasta & wftder : fase agar sH calecat are wet TA ST aa SA eet wT S resi & oer i ard 21 ara: fears atennisil, art state, aia verusi onfe ark © tafe wd wenfia faa H at Ff uftdes ore fea So aed 21 ae fee VaR ao Sage siises fase verse & fore aga srarh eta SI arara career art : faeeraiott are vege wider 3 safatad westa wa aha wast At ara ot ax ai safe | , ‘wave aiferat Hf afeata : sear a seal # oeatat aa ofl ear veer safee| sere 3 fre wi gene aaa fesrga aa feeare, face fate att, fara abate ween ¥ af, fram 4 ae fag arada east, yea aife, cer-wer At onea a Oe H upd A ese ana an sre faoet ae a SMT | He: Bra fea Yee & sya ce RRC Waa art : Raga ase & Peni 3 ara sucrea wa ar ol cary cea anf are te ere ah fe een eaten are Pa on | ale HIN erm Ne ah Hila fara Al aenraciait 1 veel Fran ae afer | ferda oa : aeofan fat & organ sees al fora weatea fetta, . aalg sores % fore rata wa Hanah, am a ara SFASaren § a acl ner afiemd armen a sr, xe } Forel es weor- 11 : Praveen vd eae 33 MA fereare aec arf | safe fargo Ree aed oA ahora ash ttre aac ae Sram Ish ett ft caaeen yaaa a a2 | (8) aren ees : outta Heri & ster Para arse arr a Paraffin aren weal ae ft oT Ter aifeo— © set aay H wand fran wd faa A Rafa; © Sa At we oie; Heh ua hla seater; sree aftada; cer siren frarsii 4 arava yafe | fase aare at Prater fafa (Procedure for Preparation of Sales Budget) fee oiste aart & fee adnan seen fara fafa ger sae aa & fer ase orate & fara agar dae fend ara @ fare’ ven ere 3% mem 8 astg vero 2 ora tts fear Sra 2 | Weis ale vars orgy aa an um whe (consolidated) ase dare ah Pasa vere ora WS Sar 81 gas soa falter eetta wearers @ wea algal & snene oe faa vere BMT awe orate ft aenfea fershh ar wa aria Gare sear STAT Bl ae TeTATAK BAT FAIR FAA ST ‘eba B | ge WaT feisee aie SS sare Set 8 a PH oe A Seda aA @ Gata a a ase aftta an eitafa 2 at sich @ aa ae fara aa secret 31 fesra aste H aesfera fash A arn a yea etal caf ara 8 aan ae aed & fare fos cet met dem sere 2, ara Hi aa stay at awe an areata sain’ vf f88 ara Bl are Hi fara a Prefered sitet 4 fret ws sen dais & oaria eaten saz aad or aaa 81 (1) Scare (Product) : af deat we @ afte var & seri an fain aac 8 ga ve sere & fry fare aa aa stra 2 (2) 8a (Territory) : ga vite 4 fash at dvifes one aaiq aargan a tenga autar sat & 1 (3) ate (Customers) : UH dear & fats wR ares al aad FSR- aad foe, faeaft aria, fet aeafat onfe aa: feat meagan ene or wach 3 ahh ae STAT ST eeb fem Fatt mrecai ae er feeh Fan are 2 (4) fsnaarat (Salesmen) : fish ai faeaaafai % syer yeqE ae a A we & faces Pears A Genrer sad ora At sr aa 21 (5) staf (Period) : waft an Rater aa & feu ae arava @ fe BA afte, fer ar arcnfes extiefl Sra | faspacrat : Serre wel Treaqan fas aoe a wre Ae fear wer 8 Sales Budget-Proforma Year ending : Area Analysis Budget | Actual Budget | Expected Budget Current Year Current Year Next Year Units | Price | Value nits Price | Value | Units | Price | Value Rs. | Rs. Re. | Re | Rs. | Rs. | By Outlets : 1. Wholesalers 2. Jobers | 34 morel es weR-M : earns Va AREA 3. Retailers | 4, Salesmen Total Sales By Products : 1. Cinthol 2. Marvell 3. Hamam | 4, Palmolive 5. Lax Total Sales By Customers : 1. Men 2, Womer 3. Boys 4, BS Girls Children Total Sales FRSC 2 Saas ot were & facia won sik ut an searea aed @ sit Se SIT Ua Hes ara F Sad SI are ad & fore At Ge grees 8 Mr. Devraj manufactures two types of toys ‘Raja’ and ‘Rani’ and sells them in Agra and Mumbai market. The following information is made available for the current year Market Budgeted Sales Actual Sales Agra: Raja 400 at Rs, 9 each 500 at Rs. 9 each Rani 300 at Rs. 21 each 200 at Rs. 21 each Mumbai : Raja 600 at Rs. 9 each 700 at Rs. 9 each Rani 500 at Rs. 21 each 400 at Rs. 21 each aa Herr @ yea eta 8 Re facta Tar citehte aif Be =H aeaifeea 8 | ae Sar qa fae af seca Aes 1%. aat Ren aa ah ae STM Fag Se | eee sie a afi-apaifea 2 aan 4 ales GT ae 2 ale sear ea eA 20% we ver fear | way oagia ae Uftadat & fare wena et ran 21 ordad & ster fase vere 3 A aaa aaR fea Market studies reveal that toy ‘Raja’ is popular as it is under priced. It is observed that if its price is increased by Re. 1 it will find a ready market. On the other hand ‘Rani’ is over priced and market could absorb more sales if its selling price is reduced to Rs. 20. The management has agreed to give effect to the above price changes, : On the above basis, the following estimates have been Prepared by Sales Manager: % inerease in sales over currei ; t bi Product Agra Rae Raja + 10% + 5% Rani +20% +10% mre Feary safttara ft aera @ fase wares 3s Rear 2 = = AGA @ stra; sy rfatad With the help of an intensive advertisem i P lent compaign, th i dh ve the estimated sales of Sales Manager are possible M8 additional amore ts emre— MI: Boao We ATER ae 35 Product Agra Mumbai Raja 60 Units 70 Units Rani 40 Units 50 Units ST SaGaT SQA st eee aad gu fase & fore awe dan se eI You are required to prepare a budget for sales incorporating the above estimates. ai (Solution) Sales Budget PerIO. wosoons wr the PO icreertyen | met Soe | ee Units | Price| Value| Units|Price| Value | Units | Price| Value Rs. Rs. Rs, Rs. Rs. Rs. Agra | Raja 400! 9 | 3600) 500} 9 | 4,500} soo} 10 | 5,000 Rani 300] 21 | 6300} 200] 21 | 4200] 400] 2 | 8000 Total 700| — | 9900] 700] — | 8700] 900 13, Mumbai | Raja 600) 9 5,400} 700) 9 6,300 700| 10 7,000 Rani 500} 21 | 10,500} 400] 21 | 8400] 600] 20 | 12,000 Total_| 1,100] — | 15,900] 1,100] — | 14700] 1300] — | 19,000 Total | Raja | 1,000/ 9 | 9000] 1200] 9 | 10800] 1200] 10 | 12,000 Rani 800| 21 | 16800] 600] 21 | 12,600] 1,000] 20 | 20,000 fecaoft : rat staf & awe & fore fat At an ga WER aa A ort wa wat SIRT wae SIRT gag ares 400 600 300 | soo af 40 (10%) 30 (5%) 60 (20%) | 50 (10%) 440 630 360 550 fear 33a 60 70 40 50 500 700 400 [600 ScUTSA TS (Production Budget) flee oe are genes awe der a gaa weal awe 8 ae fies sae Toei Aa Soe Sra ana awel 38— ara aye, am gaz, tia sein ave ane & fare onan Sar Serer awe Farr awe orate ¥ senfea At 8 arch weds ag eenfsa serea A AAT aT Rtg ETT se 81 ge Na Sear awe GH A seas were eet dar fen sate FEN arr awe craft Ff scarfea feed at aa wets sere an yaigea dar 2) ahs ae WTS a Re OTe Brera A agact a geht 8 sik aa a afta wre Ss oa eee a alga of tte @ 1 Serres awe ararera: Pieaferfiaa & sree ye aa STAT A e fra ase > aga, © Far At genes ema, eo ary ai ftafa a agafia vada, e Scr 4 ufafed ah, ae ee Sere aT a fe | ware yam ; . 3.6 Brae i, TATA THe H FLA (Objectives of Production Budget) See HE EAH TG MC SGT STEHT 8 ATE A egg Seek ee mete Rr att Rar we ea ee vata mer See em are a mam ae ta Fe ae Ta ae Freafettad weal an sat Ba ° Fra se ft 5 fee rama hapa a A yd A ara? ° Ph sel Fer ad-ila rP cg wa? ° Stel Sarria eis acl set amtacl gm Pretest fase it weet ° SSS, 7G a A ha ae aati? ° re ea era ° I (over load) a ta & = j wea fee fa at aes ere gy Sat aferensit a seat fal Oe St Biro cme STE meng Tmt a (2) ee at ae faa aa : hee EH a, au ert SOG at Resco ae Fe a Fn ae 0 Reseal§ rem meet ye HRT HA ete a woe Serer aa dan ae (Preparing of Production Budget) oa BR ae ST ame Refs Resi ae (1) ite geen A seem: saya = Site Be ates % fore azar ail 3a aes BR Cen 8 gutta ae aa Ae Sif sea we rar az Sar -aee en Pst ener Al aorel & reer- 1 : Braver yd aera a7 (4) sre wire : aft etica scares H areah, ora ore aida A amet are eft Pst areafty A opeht ta ht aera @ at sere an Pratt axa ane sree seared gah aaa ae Be Ald Hl CA Tar ST | (5) ere orrereren Wet Seay are: ce H scarey ah a_i a eT aH VATA He are aaa cen Seare fen Ha are ares erat ar of Soares awe SATA aaa ea TERA arfec) (6) rare feat : ae ase orf care, agents At cen aifeea aiRan care a era 3 een dak ear ten 8 | Sereene, af gene A a ors eeu 3,000 garEAt, sR fash 25,000 sareat wen afm ere 4,000 eargal a at scare 26,000 eereat a etm, ‘Star fe re fear tra 3 Setted = aifen orfera cara + orga fase ara — ureter weer = 25,000 + 4,000 — 3,000 = 26,000 s#Igat ESOS Sits ara faites A os Baty za A van fier F 1,08,000 waa, facia ferret F 1,20,000 eareai, ga fern H 1,32,000 sareat, ag faaet & 1,56,000 areal cen oral a ft wer ferret # 1,38,000 eareat da oA ahora 8 | arg ae 3 re sem ferret 4 18,000 gergat eee 38 | act ferret & ora tt aert owreft Rare A Paes 1/ 6 MI aR eles ET Teh Be a A fre Peet area a Sees Feat an ate, af (A) sores Fag ahh ae Br (a) serea & ser, fecha, ata et sae fat Bae: 4%, 2%, 5% aM 3% A aA a The Onida Savak Limited plans to sell 1,08,000 units of a certain product in first quarter; 1,20,000 units in second quarter; 1,32,000 units in third quarter; 1,56,000 units in fourth quarter and 1,38,000 units in the first quarter of the following year. At the beginning of the first quarter of the current year, there are 18,000 units within stock at the end of each quarter. The company plans to have an inventory equal to one-sixth of the sales for the next quarter. How many units must be manufactured in each quarters of the current year, if : (@) There is no loss in production. (b) There is loss of production at 4%, 2%, 5% and 3% in first, second, third, and fourth quarter respectively. ®t (Solution) Production Budget _ First Second | Third Fourth Items Quarter Quarter | Quarter Quarter (units) (units) (units) | (units) | Sales Budget 1,08,000 | 120,000 | 1,32,000 | —_1,56,000 Add : Closing Stock 20,000 22,000 26,000 23,000 ‘Total requirements 1,28,000 1,42,000 1,58,000 1,79,000 Less : Opening Stock 18,000 20,000 22,000 | 26,000 (@) Production requirements 1,10,000 | 1,22,000 | 1,36,000 | 153,000 dd : Loss in production 4,600 2,500 | 7,200 4,700 () Production Requirements 1,14,600 1,24,500 0 38 marches weM- I : Bearer Ya ARE aR Number of units to be produced : First Quarter = (110,000 + 96) x 100 = 1,14,600 App. Second Quarter = (1,22,000 + 98) x 100 = 1,24,500 App. Third Quarter (1,36,000 = 95) x 100 = 1,43,200 App. Fourth Quarter = (1,53,000 + 97) x 100 = 1,57,700 App. og Paftia Tet Sat AHTATSA (Adjustment of WIP) SoH UH Baie Wear 31 ae Sis awe Sale H ara Ha ah aan el @ sik a ae waft & wes 8 are] eid @1 gaia awe arate oer we at Hoong -fafitar are & fay waren sraras 21 re-ffia are A eareai at fAftla qea eared (Equivalent Finished Units) # aaa fra sire 8, Faracs fore or -fatiia gare A qohar amt ier cara B ve sre | Sear Hea = TO ser & fee ST TTA oH ia are Ss eae Ah a fee se B sah fase Fon 8 org-fiftis are A ateam Fla ea saree Sh Site ren 8 wen uf a ser aa! a We seri de aq’ dan arch 21 fase agur amet at & fay Frefefad qargaa can stat 2 A Company manufactures three products. The sales division has prepared the following forecasts for the next year : A — 4,00,000 units; B — 2,50,000 units and C — 5,00,000 units. Sone Sea AT STR TAT IK eateries Teen eK Bifea Rea ma The production in each month is expected to be uniform and the following stock levels have been decided : Finished Goods Units Work-in-Progress Units Opening | Closing | Opening | Completed | Closing Le % % A 2000 | 28000 | 60,000 5 48,000 % B 12,000 8,000 | 36,000 0 40,000 2D c 27,000_| 25,000 | 50,000 8” | 64000 6 are a4 5 fee genes saz fan Aa | Prepare a Production Budget for the next year. i (Solution) Production Budget Particulars Production in Units = A B a Total es Estimate 400.000 | 2,50.000 |” 5,00, Add : Closing Stock of ae finished goods 28,000, 8,000 | 625,000 9 | 61,000 428,000 | 2.58000] 52s i Less : Opening Stock of ieee e100 finished goods 2,000 | 12000} 37000 61,000 406.000 | 246, i Add : Closing Stock of De) ees) soe WIP in equivalent units 38400 | 28000 | 48000 | 14,400 444400 | 2.74000 | ~ $746,000 TEA 12,64,400 aqael HERI : Boasts ya AREY Tae 39 Less : Opening Stock of WIP in equivalent units 45,000 21,600 40,000 1,06,600 Production Units 3,99,400 | _2,52,400 | _5,06,000 11,57,800 STS CNT Ts (Production Cost Budget) FAA CTA SHS UE TERS ANE awe, 7H ae ao aE safes ae wal niet 2 fara faut a seararqan oaan wal ferveifira femat a ae 8 | ae Seed ase weqa genes atsrratt at feaad art At agua aera eat 81 Sores ATA ase TTA ase 1 orefta stat & sik Far a eather 2 e anh ase @ amet arm; © Fase 8 9H aM; © aren sitter ase a fia, stadia w ad-chadasie 4 fee arent safer | SOE CIMT Sse SH THN ST te A Production Cost Budget For the year. iene Departments Total A BE Cc Rs. Rs. Rs. Rs. Units to be produced Elements of Cost : Material Cost (from material budget) Labour Cost (from labour budget) Factory Overhead (from factory overhead budget) Production Cost (Total) ‘ari acre (Material Budget) Anan ase Serer sae eral F wees Sear aT Ta Gee fee arava ari Al Het AT wa era ST YaTTAAA Baers arf SA seer ws sryfeai (Components and Supplies) amaraia: avant safer ase 4 aftafea A ore 3) art ase % sania fatter aafral St onazaca a aga eran al Sree & aaa suey aA Bg wa Aeaal can et aon are ware Praca ar aera fear sre 81 ga ve Be are deer A wera Rafa & at a gan 33, wena sere & fore aravas een wet aT age SAA Aen Sa ara Ba HAH Seva A aa aT #1 eee ase SI A ai Baia aera a e at stavacat ase (Material Requisition Budget) © arei Ha Ase (Material Purchase Budget) araht srergacnat az (Material Requisition Budget) ae ase aaftr F wetter sere a aera Sa & fore arava ae At Het aay wt ‘aattert & 1 ereshh A ayer srrergeren wa A Tw See as Hwee see fea ee Praia Aaa SAA HAT I VA Sele seers AH aT | OT aH AY erat V1 sare > fw, 2 § 010 a4 3.10 qoeT HORA : PATH Va ATE ae 3 fare aq A 500 gage a Serres wes @, ral wie garg 3 Ren, art A strane Shh %, al ge aah 1,500 (500 x 3) fam. ah area A era EIA AERA TAT a vA eae aah Tra Bo a ara A ore 8 seefaT Gere Hake aah AA AT 4.50 8. oR fea. eat ge AMER GTA 6,750 ¥. (1,500 x 4.50) al awe orale AY Fer aah HARA HI AGA CTR BA MAT sree Safes see oe ents ae fra Sra 3 | ae saz Freafefian sezat At aft aac oe a fare Hh ares A age HRA sy cred At afte O aa oP A ah aa H aera gta 21 o FE FF aNd SHE BI He Stat BL 0 Fe are & a Gi after et & feted fare sree Sten 2) sree feics a fasea ware Us fiftan sere A 54,000 gargat Sai Se Sar 8 Scares aes hehe 8 ast ae aaa ST aT 2 Te at fia act # A oi Banat staan ert aon gee Ards eae a amt A ik BA BAT: 2 A 3 SHRI we eh The sales manager of Akash Ltd. expects to sell 54,000 units of a certain product. The production manager consults the storekeeper and estimates that two kinds of raw materials, A and B are required for manufacturing the product. Each unit of product requires 2 units of A and 3 units of B. ate ate & fore areata sea eT ga TAT BH Estimated Stocks of Materials for Budget Period are as follows : Finished Stock Material A Material B (Units) (Units) (Units) At Commencement 10,000 12,000 15,000 At End 14,000 13,000 16,000 srret af & fore anes srearaara ase SATE | Draw up the Material Requirements Budget for the next year. A (Solution) The units to be produced : = Sales + Desired Closing Stock - Opening Stock = 54,000 + 14,000 — 10,000 = $8,000 units. Material Requirements Budget Hee Materials in units A B Consumption for expected production of 58,000 units at the rate of 2 units for A and 3 units for B 1.16000 | 174,000 Add : Desired Closing Stock 13,000 16,000 - 1,29,000 1,90,000 Less : Expected Opening Stock 12,000 15,000 Material to be required [1.17000 | 1.75.00 ‘Urea sha awe (Material Purchase Budget) reo are da a ae eae a aT tH re Ue arta wa Bh on} art am mee meh aT, ag ney eG woreh weR-I1 : rarer wd ARE aCe 3.11 arash cht crea tet 21 sae vere arm ase 8 yd fea wa anil S nen Kara wa A sear sag Sel 8 | Ter ae Bara ea sarerante attend ax aaa 8 aa aedarcta Segal a ey 29 3 fare fiona afm aa feat on eect 2) ma at wa 8g ae ST AT ASN cht SM Haat 8 ae ase we attend arr dan fen aren 21

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