Draw up a material purchase budget from the following information: Use the given format. Estimated sales of a product is 50,000 units. Two kinds of raw materials A and B are required for manufacturing the product. Each unit of the product requires 3 units of A and 4 units of B. The estimated opening balance in the beginning of the next year: finished goods 10,000 units; A, 15,000 units; B, 20,000 units. The desirable closing balance at the end of the next year: finished product, 8,000 units; A, 10,000 units; B 12,000 units. Material Purchase Budget for the Year Material A Units Particulars Material B Units Material Required to meet Production Target Material A-33,000 x 3 Material B- 33,000 x 4 Add : Desired closing stock at the end of next year Totals Less : Expected stock at the commencement of next year (opening balance) Quantity of Materials to be purchased
Draw up a material purchase budget from the following information: Use the given format. Estimated sales of a product is 50,000 units. Two kinds of raw materials A and B are required for manufacturing the product. Each unit of the product requires 3 units of A and 4 units of B. The estimated opening balance in the beginning of the next year: finished goods 10,000 units; A, 15,000 units; B, 20,000 units. The desirable closing balance at the end of the next year: finished product, 8,000 units; A, 10,000 units; B 12,000 units. Material Purchase Budget for the Year Material A Units Particulars Material B Units Material Required to meet Production Target Material A-33,000 x 3 Material B- 33,000 x 4 Add : Desired closing stock at the end of next year Totals Less : Expected stock at the commencement of next year (opening balance) Quantity of Materials to be purchased
Managerial Accounting: The Cornerstone of Business Decision-Making
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Chapter9: Profit Planning And Flexible Budgets
Section: Chapter Questions
Problem 50E: Use the following information for Exercises 9-50 and 9-51: Assume that Stillwater Designs produces...
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Master Budget
A master budget can be defined as an estimation of the revenue earned or expenses incurred over a specified period of time in the future and it is generally prepared on a periodic basis which can be either monthly, quarterly, half-yearly, or annually. It helps a business, an organization, or even an individual to manage the money effectively. A budget also helps in monitoring the performance of the people in the organization and helps in better decision-making.
Sales Budget and Selling
A budget is a financial plan designed by an undertaking for a definite period in future which acts as a major contributor towards enhancing the financial success of the business undertaking. The budget generally takes into account both current and future income and expenses.
Question
Transcribed Image Text:Draw up a material purchase budget from the following information: Use the given
format.
Estimated sales of a product is 50,000 units. Two kinds of raw materials A and
B are required for manufacturing the product. Each unit of the product requires 3 units of A and 4
units of B. The estimated opening balance in the beginning of the next year: finished goods 10,000
units; A, 15,000 units; B, 20,000 units. The desirable closing balance at the end of the next year:
finished product, 8,000 units; A, 10,000 units; B 12,000 units.
Material Purchase Budget for the Year
Particulars
Material A
Material B
Units
Material Required to meet Production Target
Material A - 33,000 x 3
Material B- 33,000 x 4
Add : Desired closing stock at the end of next year
Totals
Units
Less : Expected stock at the commencement of
next year (opening balance)
Quantity of Materials to be purchased
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