MBA4807 MODULE OVERVIEW 2018 (1).pdf - Adobe Reader File Edit View Document Tool

Question

MBA4807 MODULE OVERVIEW 2018 (1).pdf - Adobe Reader File Edit View Document Tools Window Help 65% RARE Ltd manufactures and sells two products - wooden tables and chairs. Management asked you to assist in preparing the budget for quarter 3 of 2018. (July to Sept). There are 13 wecks in the quarter. You have been provided with the following information: Tables Chairs Forecast sales 1,300 1,800 Stock balance as at 1 July 2018 320 480 Finished goods inventory level for tables should be the equivalent to 10 days sales volume and chairs should be the equivalent of 15 days sales volume Manufacturing data Price Tables Chairs Raw material required: Wood R25.00 Labour RS5.00hour15 10 hours Raw material balance as at 1 July 2018 is 2,000 m2 Raw material balance as at 3D September 2018, sufficient raw material on hand to meet 15 days production requirement. Labour information The company has 60 employees, working a 40 hour, 5 day week and are paid R55 per hour Overtime is available and payable premium of 20%. Owing to new machnery instaled. workers are only expected to be 80% efficient Required Prepare the following: 1. 2. Production budget Labour budgat, hours and value. Activate Windows Go to Settings to activate Windows. O Type here to search

Explanation / Answer

Solution: Computation of Production Budget (Units): Particulars Tables Chairs Total Forecast Sales 1300 1800 3100 Add: Closing Stock 143 297 440 Tables = (1300*10/91) Chairs = (1800*15/91) Less: Opening Stock 320 480 800 Total Production Require 1123 1617 2740 Raw Material Budget (in Amount): Raw Material Require Table Chair Total Table= (1300*9*25) 2,92,500.00 1,80,000.00 4,72,500.00 Chair= (1800*4*25) Add: Closing Stock of Raw material Tables = (1300*15/91)*9*25      48,214.00      29,670.00      77,884.00 Chairs = (1800*15/91)*4*25 Less: Opening Stock of Raw Material      50,000.00 (2000*25) Raw Material require to purchase 5,00,384.00 Labour Budget in Hours: Particulars Table Chair Total Labour Hours Require Table =(1300*15)      19,500.00      18,000.00      37,500.00 Chair = (1800*10) Less: Labour Hours Available      24,960.00 (60*40*13*80%) Overtime Labour Hours      12,540.00 Labour Budget in Amount: Normal labour cost 1,24,800.00 (24960*5) Add: Overtime rate      75,240.00 (12540*5*120%) Total Budgeted Labour Cost 2,00,040.00

Related Questions

Navigate

• Browse (All)
• Browse M
• Subjects

---

---

Integrity-first tutoring: explanations and feedback only — we do not complete graded work. Learn more.