BUDGET PREPARATION

SOLUTION FOR BUDGET EXERCISE

 MK Sdn. Bhd.
Sales Budget for the Year ended 31 December, 2016

Selling Price (RM) Quantity (Units)

Revenue (RM)

Product F 105.40 5,000

527,000
Product G 164.00 1,000
164,000

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Total 6,000
691,000

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 MK Sdn. Bhd.
Production Budget for the Year ended 31 December, 2016

Product F
Product G
(units)
(units)

Forecast Sales 5,000

1,000
Add: Planned Closing Stock 1,100
50

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6,100 1,050
Less: Opening Stock 100
50

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 MK Sdn. Bhd.
Material Usage and Purchases Budget for the Year ended 31 December, 2016

M111 M112

(kg) (liter)

Product F – 12kg X 6,000 72,000

- 6liter X 6,000
36,000
Product G - 12kg X 1,000 12,000
- 8liter X 1,000
8,000

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Required for Production 84,000
44,000
Add: Planned Closing Stock 6,000
1,000

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 MK Sdn. Bhd.
Direct Labour Budget for the year ended 31 December 2016

Product F Product G

Production Requirement (units) 6,000

1,000
Direct Labour Hours per unit 14 hrs
20 hrs

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Total DLH
84,000hrs 20,000hrs
Labour Rate per Hour RM2.05
per hr RM2.05 per hr

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Direct Labour Cost