Netflex Computer Supplies produces and sells office equipment and is preparing the budget for next month. The following details are extracts from the budgeting records: Office equipment Opening inventory Budgeted sales (units) Selling price $ Desktop computers 63 290 120 Laptops 36 120 208 Printers 90 230 51 Closing inventory is 30% of sales units for the month. All three products are made products are made using two types of materials (material A and B) and two types of labour (skilled C and unskilled D). The amount of each input is as follows: Office equipment Material A Material B Labour C Labour D Meters Cubic meters Hours Hours Desktop computers 4 2 3 2 Laptops 5 3 5 8 Printers 2 1 2 - Cost $12 per meter $7 per cubic meter $4 per hour $6 per hour Netflex’s opening inventory are as follows: Material A 142 meters Material B 81 cubic meters Netflex intend to increase this during April, so that there are sufficient raw materials to produce 50 units of each item of equipment. You are required to calculate the following: i. Budgeted sales ii. Budgeted production for all three items iii. Budgeted usage of materials A and B iv. Materials purchases budget v. Labour budget
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.
Netflex Computer Supplies produces and sells office equipment and is preparing the budget for
next month. The following details are extracts from the budgeting records:
Office equipment Opening inventory Budgeted sales
(units)
Selling price $
Desktop computers 63 290 120
Laptops 36 120 208
Printers 90 230 51
Closing inventory is 30% of sales units for the month.
All three products are made products are made using two types of materials (material A and B)
and two types of labour (skilled C and unskilled D). The amount of each input is as follows:
Office equipment Material A Material B Labour C Labour D
Meters Cubic meters Hours Hours
Desktop computers 4 2 3 2
Laptops 5 3 5 8
Printers 2 1 2 -
Cost $12 per meter $7 per cubic meter $4 per hour $6 per hour
Netflex’s opening inventory are as follows:
Material A 142 meters
Material B 81 cubic meters
Netflex intend to increase this during April, so that there are sufficient raw materials to produce
50 units of each item of equipment.
You are required to calculate the following:
i. Budgeted sales
ii. Budgeted production for all three items
iii. Budgeted usage of materials A and B
iv. Materials purchases budget
v. Labour budget
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