Business Finance

MODULE 2

Aerox Bikes Company

SALES BUDGET
For the Year Ended December 31, 2021

Quarter 1 Quarter 2 Quarter 3 Quarter 4

Forecasted Unit Sales 1,000 1,000 1,500 1,500
x Price per unit 70.00 70.00 75.00 75.00
Total Gross Sales 70,000.00 70,000.00 112,500.00 112,500.00
-Sales discounts and allowances - - - -
Total Net Sales 70,000.00 70,000.00 112,500.00 112,500.00

Aerox Bikes Company

PRODUCTION BUDGET
For the Year Ended December 31, 2021

Qtr 1 of Qtr 2 of
Quarter 1 Quarter 2 Quarter 3 Quarter 4 next year next year
Forecasted Unit Sales 1,000 1,000 1,500 1,500 3,500 4,500
+Desired Ending 1,350
300 450 450 1,050
Inventory
Total Required Units 1,300 1,450 1,950 2,550 4,850
-Beginning Inventory - 300 450 450 1050
Required Production
1,300 1,150 1,500 2,100 3,800
Units

Aerox Bikes Company

DIRECT MATERIALS BUDGET
For the Year Ended December 31, 2021

Qtr 1 of
Quarter 1 Quarter 2 Quarter 3 Quarter 4 next year
Units to be Produced 1,300 1,150 1,500 2,100 3,800
Direct Materials per Unit 3.20 3.20 3.20 3.20 3.20
Total Pounds Needed for Production 4,160 3,680 4,800 6,720 12,160
+Desired Direct Materials Ending -
736 960 1,344 2,432
Inventory
Total Required Units 4,896 4,640 6,144 9,152
-Beginning Inventory - 736 960 1,344
Pounds of Direct Material Required 4,896 3,904 5,184 7,808
Cost per Pounds P1.50 P1.50 P1.50 P1.50
Total Cost of Direct Material Purchase P7,344.0
P5,856.00 P7,776.00 P11,712.00
0

Aerox Bikes Company

DIRECT LABOR BUDGET
For the Year Ended December 31, 2021

Quarter 1 Quarter 2 Quarter 3 Quarter 4

Units to be Produced 1,300 1,150 1,500 2,100
Direct Labor Hours per Unit 0.75 0.75 0.75 0.75
Total Required Direct Labor Hours 975 862.5 1,125 1,575
Labor Cost per Unit P20.00 P20.00 P20.00 P20.00
Total Direct Labor Cost P22,500.0
P19,500.00 P17,250.00 P31,500.00
0
Aerox Bikes Company
MANUFACTURING OVERHEAD BUDGET
For the Year Ended December 31, 2021
 Quarter 1 Quarter 2 Quarter 3 Quarter 4 TOTAL
Total Required Direct Labor
975 862.5 1,125 1,575 4,537.5
Hours

Variable Costs
Indirect Material P975.00 P862.50 1,125.00 P1,575.00 P4,537.50
Indirect Labor 1,218.75 1,078.50 1,406.25 1,968.75 5,672.25
Maintenance 243.75 215.62 281.25 393.75 1,134.37
Utilities 487.50 431.25 562.50 787.50 2,268.75
Total Variable Manufacturing
P2,925.00 P2,587.87 P3,375.00 P4,725.00 P13,612.87
Costs

Fixed Costs
Supervisory Salaries P15,000.00 P15,000.00 P15,000.00 P15,000.00 P60,000.00
Maintenance Salaries 4,000.00 4,000.00 4,000.00 4,000.00 16,000.00
Insurance 7,000.00 7,000.00 7,000.00 7,000.00 28,000.00
Depreciation Expenses 3,000.00 3,000.00 3,000.00 3,000.00 12,000.00
Total Fixed Costs P29,000.0
P29,000.00 P29,000.00 P29,000.00 P116,000.00
0
Total Manufacturing Overhead P33,725.0
P31,925.00 P31,587.87 P32,375.00 P129,612.87
Costs 0

Aerox Bikes Company

SELLING and ADMINISTRATIVE BUDGET
For the Year Ended December 31, 2021

Quarter 1 Quarter 2 Quarter 3 Quarter 4 TOTAL

Budgeted Unit Sales 1,000 1,000 1,500 1,500 5,000

Selling Expenses
Sales Commission P2,000.00 P2,000.00 P3,000.00 P3,000.00 P10,000.00
Transportation 500.00 500.00 750.00 750.00 2,500.00
Sales Salaries 5,000.00 5,000.00 5,000.00 5,000.00 20,000.00
Marketing Expenses 4,500.00 4,500.00 4,500.00 4,500.00 18,000.00
Total Selling Expenses P12,000.00 P12,000.00 P13,250.00 P13,250.00 P50,500.00

Administrative expenses
Administrative salaries P5,000.00 P5,000.00 P5,000.00 P5,000.00 P20,000.00
Insurance 1,500.00 1,500.00 1,500.00 1,500.00 6,000.00
Depreciation expenses 2,000.00 2,000.00 2,000.00 2,000.00 8,000.00
Total Administrative Expenses P8,500.00 P8,500.00 P8,500.00 P8,500.00 P34,000.00
Total Selling and Administrative
P20,500.00 P20,500.00 P21,750.00 P21,750.00 P84,500.00
Expenses

BUDGETED INCOME STATEMENT

Aerox Bikes Company

Sales Budget
For the Year Ended December 31, 2021

Q1 Q2 Q3 Q4 TOTAL

Expected Sales (Units) 1,000 1,000 1,500 1,500 5,000

Sales Price per Unit P70.00 P70.00 P75.00 P75.00
Total Sales P70,000.00 P70,000.00 P112,500.00 P112,500.00 P365,00.00
-Sales Discounts and Allowances - - - - -
Net Sales P70,000.00 P70,000.00 P112,500.00 P112,500.00 P365,000.00

Aerox Bikes Company

Production Budget
For the Year Ended December 31, 2021

Q1 Q2 Q3 Q4 TOTAL

Expected Sales (Units) 1,000 1,000 1,500 1,500 5,000

+Desired Ending Invty 300 450 450 1,050 2,250
Total 1,300 1,450 1,950 2,550 7,250