GROUP 2 - PRODUCT CHOCO ROLLS

FK-3183 Rajindu Radhakrishnan

FK-3206 Sarun Babu
FK-3229 Anjana Nair J
FK-3251 Jith Jayachandran
FK-3273 Daya Vijayan
FK-3301 Harigovind A
Sales mainly focused in Three regions Kozhikode, Kochi and
Trivandrum. The Sales is estimated to increase at 6%, 8%
and 7% of the current year budgeted sale respectively at
Thrissur,Kottayam and Trivandrum. The sale price of the
product is increased by Rs 1.

Regions CURRENT QUARTER BUDGETED SALE

Quantity Rate/unit Total amount

THRISSUR 2400 ₹ 110.00 ₹ 264,000.00

KOTTAYAM 2300 ₹ 110.00 ₹ 253,000.00

TRIVANDRUM 2400 ₹ 110.00 ₹ 264,000.00

ALL REGIONS 7100 ₹ 781,000.00

SALES BUDGET

CURRENT QUARTER ACTUAL SALES NEXT QUARTER BUDGETED SALES

Quantity Rate/unit Total amount Quantity Rate/unit Total amount

2480 ₹ 110.00 ₹ 272,800.00 2544 ₹ 111.00 ₹ 282,384.00

2350 ₹ 110.00 ₹ 258,500.00 2484 ₹ 111.00 ₹ 275,724.00

2480 ₹ 110.00 ₹ 272,800.00 2568 ₹ 111.00 ₹ 285,048.00

7310 ₹ 804,100.00 7596 ₹ 843,156.00

Total sales estimated for the Quarter ending March 2019 is
7596 units and is divided in the ratio 32%, 33% and 35% in
the months January, February and March respectively. A
closing stock of 5% of the month's budgeted sales is
maitained. The budgeted sale for December 2018 is 2400
units.

PRODUCTION BUDGET

Particulars Jan-19 Feb-19

Budgeted sales 2431 2507

Desired level of 122 125
Closing stock
Net stock 2552 2632
less : Opening Stock 120 122
Total Quantities to 2432 2510
be produced
 ch 2019 is
nd 35% in
tively. A
s is
8 is 2400

CTION BUDGET

Mar-19 TOTAL

2659 7596

133 380

2792 7976
125 367

2667 7609
Information :

1) Cash Balance as on 1st January, 2019 is Rs 280000 .

2) Sales constitute 50% Cash sales and 50% Credit sales .
3) 5% on total sales is to be paid as sales commission in the next month following a
4) Period of credit allowed to customer is one month.
5) Period of credit allowed by suppliers is one month .
6) Delay in payment of selling overhead is 1 month .
7) Rs 130000 is to be paid in March towards insurance.
8) Sale of old machinery will fetch Rs 180000 in April .
9) Assuming that Sales and purchases made for December 2018 is to be Rs 260000
10) Selling overhead for December 2018 is assumed to be Rs 5300.

Month Sales Purchases Rent

January ₹ 264,000.00 ₹ 170,000.00 ₹ 6,000.00
February ₹ 265,500.00 ₹ 170,500.00 ₹ 6,000.00
March ₹ 266,000.00 ₹ 168,000.00 ₹ 6,000.00
April ₹ 260,000.00 ₹ 162,050.00 ₹ 6,000.00
May ₹ 263,500.00 ₹ 169,000.00 ₹ 6,000.00
June ₹ 265,000.00 ₹ 169,500.00 ₹ 6,000.00
ion in the next month following actual sales.

ecember 2018 is to be Rs 260000 and Rs 170000 respectively .

ed to be Rs 5300.

Selling overhead
₹ 5,000.00
₹ 5,300.00
₹ 5,500.00
₹ 5,450.00
₹ 5,600.00
₹ 5,350.00
 Particulars January

Opening Balance ₹ 280,000.00

Reciepts :
Cash Sales ₹ 132,000.00
Reciepts from Customers ₹ 130,000.00
Sale of Machinery -
Total Reciepts ₹ 262,000.00

Expenditure :
Payment to Suppliers ₹ 170,000.00
Sales Commission ₹ 13,000.00
Insurance -
Rent ₹ 6,000.00
Selling Overhead ₹ 5,300.00
Total Expenditure ₹ 194,300.00

Closing Balance ₹ 347,700.00

CASH BUDGET

February March April May June

₹ 347,700.00 ₹ 418,250.00 ₹ 358,925.00 ₹ 609,125.00 ₹ 684,375.00

₹ 132,750.00 ₹ 133,000.00 ₹ 130,000.00 ₹ 131,750.00 ₹ 132,500.00

₹ 132,000.00 ₹ 132,750.00 ₹ 133,000.00 ₹ 130,000.00 ₹ 131,750.00
- - ₹ 180,000.00 - -
₹ 264,750.00 ₹ 265,750.00 ₹ 443,000.00 ₹ 261,750.00 ₹ 264,250.00

₹ 170,000.00 ₹ 170,500.00 ₹ 168,000.00 ₹ 162,050.00 ₹ 169,000.00

₹ 13,200.00 ₹ 13,275.00 ₹ 13,300.00 ₹ 13,000.00 ₹ 13,175.00
- ₹ 130,000.00 - - -
₹ 6,000.00 ₹ 6,000.00 ₹ 6,000.00 ₹ 6,000.00 ₹ 6,000.00
₹ 5,000.00 ₹ 5,300.00 ₹ 5,500.00 ₹ 5,450.00 ₹ 5,600.00
₹ 194,200.00 ₹ 325,075.00 ₹ 192,800.00 ₹ 186,500.00 ₹ 193,775.00

₹ 418,250.00 ₹ 358,925.00 ₹ 609,125.00 ₹ 684,375.00 ₹ 754,850.00

The cost details for production of 2500 units are given below :

Particulars Cost per unit

Materials ₹ 62.00
Labour ₹ 12.00
Expenses ₹ 2.00
Factory Overhead (fixed) ₹ 4.45
Factory Overhead (variable) ₹ 3.28
Administrative overhead (fixed) ₹ 0.40
Administrative overhead (variable) ₹ 0.45
Selling & Distribution overhead (variable) ₹ 2.20

Company decides to propose a Flexible Budget with a production target of 1500 units and

Particulars 2500 units

per unit

Materials ₹ 62.00
Labour ₹ 12.00
Expenses ₹ 2.00
Factory Overhead (fixed) ₹ 4.45
Factory Overhead (variable) ₹ 3.28
Administrative overhead (fixed) ₹ 0.40
Administrative overhead (variable) ₹ 0.45
Selling & Distribution overhead (variable) ₹ 2.20

Total Production Cost ₹ 86.78

Effect on Net Profit :

Particulars Amt (2500 units)

Sales ( selling price - Rs 114/unit ) ₹ 285,000.00

less : Production Cost ₹ 216,950.00

Net Profit ₹ 68,050.00

production target of 1500 units and 2000 units.

2500 units 1500 units 2000 units

Amt per unit Amt per unit Amt

₹ 155,000.00 ₹ 62.00 ₹ 93,000.00 ₹ 62.00 ₹ 124,000.00

₹ 30,000.00 ₹ 12.00 ₹ 18,000.00 ₹ 12.00 ₹ 24,000.00
₹ 5,000.00 ₹ 2.00 ₹ 3,000.00 ₹ 2.00 ₹ 4,000.00
₹ 11,125.00 ₹ 7.42 ₹ 11,125.00 ₹ 5.56 ₹ 11,125.00
₹ 8,200.00 ₹ 3.28 ₹ 4,920.00 ₹ 3.28 ₹ 6,560.00
₹ 1,000.00 ₹ 0.67 ₹ 1,000.00 ₹ 0.50 ₹ 1,000.00
₹ 1,125.00 ₹ 0.45 ₹ 675.00 ₹ 0.45 ₹ 900.00
₹ 5,500.00 ₹ 2.20 ₹ 3,300.00 ₹ 2.20 ₹ 4,400.00

₹ 216,950.00 ₹ 90.02 ₹ 135,020.00 ₹ 87.99 ₹ 175,985.00

Amt (1500 units) Amt (2000 units)

₹ 171,000.00 ₹ 228,000.00
₹ 135,020.00 ₹ 175,985.00

₹ 35,980.00 ₹ 52,015.00