ACT507 Accounting for Managers

Published : 03-Sep,2021 | Views : 10

Question:

Write a brief report addressing Rita’s concerns, using some of the concepts covered in chapters (15, 16, 17, 20, 22, 23) in this unit,AND the information provided from the completion of Part A of this assignment, and any additional calculations using the existing data that you feel are relevant. Your report should also include a discussion of the impact of Paulo’s intended investment in new manufacturing capacity. Support your report.

Prepare an operating budget for the first quarter (showing each month and totals for the quarter) with the following schedules:
a. Sales budget
b. Production budget
c. Direct materials purchases budget
d. Direct labour budget
e. Manufacturing Overhead budget
f. Ending finished goods inventory budget
g. Cost of goods sold budget
h. Budgeted income statement (ignore income taxes and GST)
i. Cash budget

Answer:

Particulars	January	February	March	Total
Budgeted Absorption Cost of Opening Inventory	$3,070	$4,590.37	$4,555.19	$3,070
Opening Stock of Finished Goods	49000	36780	41382	49000
Opening Stock Value	$15,04,30,000	$16,88,33,866	$18,85,02,784	$15,04,30,000
Add: Total Production Cost	$29,56,65,832	$30,01,95,990	$35,13,94,062	$94,72,55,884
	$44,60,95,832	$46,90,29,856	$53,98,96,846	$1,09,76,85,884
Less: Closing Finished Goods Inventory	$16,88,33,866	$18,85,02,784	$23,42,62,708	$23,42,62,708
Budgeted Cost of Goods Sold	$27,72,61,966	$28,05,27,072	$30,56,34,138	$86,34,23,176
Particulars	January	February	March	Total
Total Sales Revenue	$48,27,69,000	$38,61,90,000	$43,45,11,000	$1,30,34,70,000
Less: Cost of Goods Sold	$27,72,61,966	$28,05,27,072	$30,56,34,138	$86,34,23,176
Gross Profit	$20,55,07,034	$10,56,62,928	$12,88,76,862	$44,00,46,824
Less: Selling & Admin Expenses	$10,00,02,150	$7,99,97,900	$9,00,04,750	$27,00,04,800
Budgeted Net Profit/(Loss)	$10,55,04,884	$2,56,65,028	$3,88,72,112	$17,00,42,024
Particulars	January	February	March	Total
Collection from the month's sales	$37,65,59,820	$30,12,28,200	$33,89,18,580	$1,01,67,06,600
Collection from last month's sales	$15,44,86,000	$9,65,53,800	$7,72,38,000	$32,82,77,800
Cash Sales	$96,55,380	$77,23,800	$86,90,220	$2,60,69,400
Purchase of Direct Material	($7,34,90,112)	($8,07,88,328)	($10,46,59,676)	($25,89,38,116)
Direct Labor Cost	($2,89,84,500)	($2,96,55,900)	($3,72,43,800)	($9,58,84,200)
Variable Manufacturing Overhead	($8,94,20,332)	($9,14,91,674)	($11,49,01,169)	($29,58,13,175)
Supervision Cost	($4,29,12,800)	($4,29,12,800)	($4,29,12,800)	($12,87,38,400)
Rates & utilities	($31,66,400)	($31,66,400)	($31,66,400)	($94,99,200)
Maintenance	($3,48,61,121)	($3,48,61,121)	($3,48,61,121)	($10,45,83,362)
Other Fixed Overhead	($1,53,26,000)	($1,53,26,000)	($1,53,26,000)	($4,59,78,000)
Selling & Admin Expenses	($10,00,02,150)	($7,99,97,900)	($9,00,04,750)	($27,00,04,800)
Net Cash Flow from Operating Activities	$15,25,37,786	$2,73,05,678	($1,82,28,916)	$16,16,14,548
Net Cash Flow from Investing Activities	$0	($38,31,500)	$0	($38,31,500)
Cash Flow from Financing Activities:	($15,44,86,000)	$0	$0	($15,44,86,000)
Net Increase/(Decease) in Cash Balance	($19,48,214)	$2,34,74,178	($1,82,28,916)	$32,97,048
Add: Opening Cash Balance	$38,31,500	$18,83,286	$2,53,57,464	$38,31,500
Closing Balance	$18,83,286	$2,53,57,464	$71,28,548	$71,28,548