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  • MAF551 - Exercise 1 - Answer Question 3 - Orange SDN BHD - Ridzuan Bin Saharun - 2017700141

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    RIDZUAN SAHARUN
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    Ridzuan bin Saharun is a student taking the course MAF551. He is answering Question 3 which asks for sales, production, purchasing, and labor cost budgets for 2020. The summaries are: The sales budget forecasts sales of RM21.19 million for the year, with quarterly sales ranging from RM4.32 million to RM6.71 million. The production budget calculates the units to be produced each quarter based on forecasted sales and inventory levels, totaling 121,055 units for the year. The purchasing budget determines the materials needed each quarter based on production quantities and inventory levels, with a total materials cost of RM2,932,936 for the year.

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    Ridzuan bin Saharun is a student taking the course MAF551. He is answering Question 3 which asks for sales, production, purchasing, and labor cost budgets for 2020. The summaries are: The sales budget forecasts sales of RM21.19 million for the year, with quarterly sales ranging from RM4.32 million to RM6.71 million. The production budget calculates the units to be produced each quarter based on forecasted sales and inventory levels, totaling 121,055 units for the year. The purchasing budget determines the materials needed each quarter based on production quantities and inventory levels, with a total materials cost of RM2,932,936 for the year.

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    47 views2 pages

    MAF551 - Exercise 1 - Answer Question 3 - Orange SDN BHD - Ridzuan Bin Saharun - 2017700141

    Uploaded by

    RIDZUAN SAHARUN
    Ridzuan bin Saharun is a student taking the course MAF551. He is answering Question 3 which asks for sales, production, purchasing, and labor cost budgets for 2020. The summaries are: The sales budget forecasts sales of RM21.19 million for the year, with quarterly sales ranging from RM4.32 million to RM6.71 million. The production budget calculates the units to be produced each quarter based on forecasted sales and inventory levels, totaling 121,055 units for the year. The purchasing budget determines the materials needed each quarter based on production quantities and inventory levels, with a total materials cost of RM2,932,936 for the year.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    of 2

    Name: Ridzuan bin Saharun

    Student ID: 2017700141


    Course: MAF551
    Group: NACAB5C

    Answer Question 3

    i) Sales Budget

    Year 2020
    Q1 Q2 Q3 Q4
    Quarter TOTAL
    (Jan-March) (Apr-June) (July-Sept) (Oct-Dec)
    Sales Volume 30,000 40,000 20,000 30,500 120,500
    Unit Price 144 144 220 220
    Sales Budget (RM) 4,320,000 5,760,000 4,400,000 6,710,000 21,190,000

    Production Cost 120


    Margin 20% With 20% Margin, effectuve for Q1 - Q2 year 2020
    Standard Selling Price 144

    ii) Production budget

    2020

    Q1
    Q1 Q2 Q3 Q4
    Quarter TOTAL (Jan-
    (Jan-March) (Apr-June) (July-Sept) (Oct-Dec)
    March)
    Sales Volume 30,000 40,000 20,000 30,500 120,500 31,110
    (+) Closing Inventory 20,000 10,000 15,250 15,555 -15,000
    (-) Opening Inventory -15,000 -20,000 -10,000 -15,250 15,555
    Unit to be produced 35,000 30,000 25,250 30,805 121,055 31,110

    Base on information given, closing inventory is 50% of the next quarter’s forecast sale

    iii) Purchasing Budget

    2020

    Q1 Q2 Q3 Q4
    Quarter
    (Jan-March) (Apr-June) (July-Sept) (Oct-Dec)
    Unit to be produced 35,000 30,000 25,250 30,805
    Kg per unit (w-1) 5 5 5 5
    Unit material to be used 175,000 150,000 126,250 154,025
    (+) Closing Inventory 120,000 101,000 123,220 124,440
    (-) Opening Inventory -140,000 -120,000 -101,000 -123,220
    Total material to used 155,000 131,000 148,470 155,245
    Price per unit(RM) (note-1) 4 4.4 4.4 4.4
    Purchasing Budget 620,000 576,400 653,268 683,078

    W-1
    Cost to produce 1 unit RM20
    Price per kg RM4
    Kg / unit 5

    note-1
    The standard material price is expected to increase by 10% with effect from 1 April 2020
    iv) Labour cost budget
    Year 2020
    Q1 Q2 Q3 Q4
    Quarter
    (Jan-March) (Apr-June) (July-Sept) (Oct-Dec)
    Unit to be produced 35,000 30,000 25,250 30,805
    Hours per unit (w-2) 6 6 4 4
    Total Hours 210,000 180,000 101,000 123,220
    Rate per labour hours (RM) 10 10 10 10
    Labor cost (RM) 2,100,000 1,800,000 1,010,000 1,232,200

    Required
    56,000 56,000 56,000 56,000
    =350*((40*4))

    Overtime 154,000 124,000 45,000 67,220


    Rate
    5 5 5 5
    = 50% premium
    Labor cost (RM) 770,000 620,000 225,000 336,100

    Total Labour Cost 2,870,000 2,420,000 1,235,000 1,568,300

    W-2
    Cost to produce 1 unit RM60
    Price per hour RM10
    Hours / unit (Q1 - Q2) 6

    Hours / unit (Q3 - Q4)


    decrease by 120 minutes per unit 4

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