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  • Budgetary Control

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    Shreya Bhagavatula
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    The document provides information for preparing budgets, including sales budgets, production budgets, material usage budgets, purchase budgets, and cash budgets for various companies and products. Specifically: - It provides historical sales data for Products A and B to prepare a sales budget for 2022, factoring in targeted sales quantity and price increases/decreases. - It provides sales budget and stock position data to prepare a production budget for Products A and B in 2022. - It provides production quantity targets and material usage rates to calculate the direct material usage and purchase budget for Products A and B in 2022. - It provides estimated monthly sales, purchases, expenses and opening cash balances to prepare a cash budget for

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    The document provides information for preparing budgets, including sales budgets, production budgets, material usage budgets, purchase budgets, and cash budgets for various companies and products. Specifically: - It provides historical sales data for Products A and B to prepare a sales budget for 2022, factoring in targeted sales quantity and price increases/decreases. - It provides sales budget and stock position data to prepare a production budget for Products A and B in 2022. - It provides production quantity targets and material usage rates to calculate the direct material usage and purchase budget for Products A and B in 2022. - It provides estimated monthly sales, purchases, expenses and opening cash balances to prepare a cash budget for

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    32 views2 pages

    Budgetary Control

    Uploaded by

    Shreya Bhagavatula
    The document provides information for preparing budgets, including sales budgets, production budgets, material usage budgets, purchase budgets, and cash budgets for various companies and products. Specifically: - It provides historical sales data for Products A and B to prepare a sales budget for 2022, factoring in targeted sales quantity and price increases/decreases. - It provides sales budget and stock position data to prepare a production budget for Products A and B in 2022. - It provides production quantity targets and material usage rates to calculate the direct material usage and purchase budget for Products A and B in 2022. - It provides estimated monthly sales, purchases, expenses and opening cash balances to prepare a cash budget for

    Copyright:

    © All Rights Reserved
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    of 2

    Budgetary control

    1. P.C.T. Ltd. provides you the following figures for the year 2021
    Particulars Product A Product B
    Sales (in units): 1st Quarter 1,250 1,600
    lInd Quarter 2,950 800
    lllrd Quarter 2,700 1,000
    IVth Quarter 3,100 600
    Selling Price per unit Rs. 24 Rs. 50
    Targets for year 2022
    Sales Quantity increase (decrease) -20% 25%

    Selling Price increase (decrease) 25% -20%


    Sales area X, Y and Z respectively produce 10%, 20%, 70% of Product 'A' sales and 70%, 20% and 10% of Product
    'B' sales.

    Required: Prepare Sales Budget for the year 2022

    2. XYZ company has provided the following information.


    Particulars Product A Product B
    Sales( in units) as per Sales Budget
    1st Quarter - 2022 1,000 2,000
    2nd Quarter - 2022 2,360 1,000
    3rd quarter - 2022 2,160 1,250
    4th Quarter - 2022 2,480 750
    Stock position as on 01.01.2022
    percentage of 1st quarter of 2022 sales 20% 100%
    Stock position ending 1st, 2nd and 3rd quarters
    Percentage of next Quarter sales 50% 50%
    Stock Position on 31.12.2022 2,200 1000
    Prepare production budget for the year 2022.

    3. A manufacturing company provides you the following information


    Particulars Product A Product B
    Material X @ Rs. 3 per unit 2 units 4 units
    Material Y @ Re. 1 per unit 1 unit 2units
    Units to be produced as per production budget 10,000 4,000

    Inventory of Raw material :


    Particulars Material X Material Y
    Opening stock as on 01.01.2022 12,000 units 2,000 units
    estimated closing stock as on 31.12.2022 16,000 units 4,000 units
    Prepare the Direct Material usage and Purchase Budget for the year 2022
    1
    4. Prepare cash budget of Tulsian ltd for april to june 2022 from the following information

    Estimated sales, purchases and expenses are as follows


    Particulars Jan Feb March April May June
    Sales 2,00,000 4,00,000 6,00,000 8,00,000 10,00,000 12,00,000
    Purchases 1,52,000 3,06,000 4,60,000 6,08,000 7,56,000 9,04,000
    wages 24,000 30,000 36,000 48,000 60,000 72,000
    Adm. Expenses 30,000 40,000 50,000 60,000 70,000 80,000
    Selling & Distribution
    exp 30,000 50,000 70,000 90,000 1,10,000 1,00,000

    5. PCT Ltd. provides you the following information: Production and Sales at 60%
    capacity
    Particulars
    Variable Expenses:
    Production 1,50,000
    Administration 1,50,000
    Selling & Distribution 1,20,000
    Semi-Variable Expenses:
    Production . 50,000
    Administration 60,000
    Selling & Distribution 70,000
    Fixed Expenses: -
    Production 3,40,000

    Administration 3,20,000
    Selling & Distribution 3,00,000
    Total Sales 15,00,000
    Note: Semi-variable expenses are constant between 55% and 75% of capacity,
    They are increasing by 10%, if the capacity exceeds 75% but does not exceed 90% of capacity and by 20% if the
    capacity exceeds 90% of capacity.
    Required: Prepare a Flexible Budget at 70%, 80%, and 100% capacity level.

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