Material uses and purchases budget, Financial Management

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XYZ company produces three products X,Y and Z. for the coming accounting period budgets are to be prepared based on following information.

Budgeted Sales

Product X       2,000 at RO 100 each

Product Y       4,000 at RO 130 each

Product Z        3,000 at RO 150 each

Budgeted usage of raw material

 

RM11

RM22

RM33

Product X

5

2

-

Product Y

3

2

2

Product Z

2

1

3

Cost per unit of material

RO 5

RO 3

RO 4

Finished stocks budget

 

Product X

Product Y

Product Z

Opening

500

800

700

Closing

600

1,000

800

Raw material stocks budget

 

RM11

RM22

RM33

Opening

21,000

10,000

16,000

Closing

18,000

9,000

12,000

 

Product X

Product Y

Product Z

Expected hours per unit

4

6

8

Expected hourly rate (labour)

RO 9

RO 9

RO 9

Required;

Draw up the following functional budgets.

a)  Sales budget in terms of both quantity and value

b)  Production budget

c)  Material usage budget

d) Material purchases budget

e) Labour budget


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