Your CEO has also asked you to prepare a production cost budget for the MiniY fo

Question

Your CEO has also asked you to prepare a production cost budget for the MiniY for May 20X8. The actual costs in April 20X8 were as follows:

MiniY: Production Cost Budget April 20X8

Production–Units of MiniY 3,000

Components cost (variable) 24,000,000

Labor cost (variable) 13,500,000

Rent (fixed) 6,000,000

Depreciation (fixed) 6,000,000

Other (fixed) 2,000,000

Total $51,500,000

For the month of May, the number of MiniY produced will increase to 3,200, reflecting an anticipated sales increase related to a new marketing campaign.

Question 5: Using the above information, prepare a budget for May 20X8, stating the total cost. Use a spreadsheet to display your data and calculations.

Explanation / Answer

BUDGET FOR MAY Per unit For 3200 units a Component cost ( 24000000 / 3000) 8,000.00 25,600,000.00 b Direct Labour (13500000/3000) 4,500.00 14,400,000.00 c Fixed overheads :- d Rent - 6,000,000.00 e Depreciation - 2,000,000.00 f Other fixed - 2,000,000.00 TOTAL COST 50,000,000.00

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