budgets

System

i need help with this question as i don't know where to start?<BR><BR>question<BR><BR>you are employed as a management accountant with preston chemical processors ltd and, for some years now, you have been responsible for preparing quaterly budgets for each of the company's two divisions. Currently you are working on budgets for the first quarter of 2002. Each quarter consists of 12 five day weeks.<BR><BR>one of the divisions, based in bamer bridge makes and sells two products used by paint manufacturers. Both products, the "Century" & the "Decade" are sold in small barrels and use the same material and labour but in different quantities.<BR><BR>The production labour-force is 50 employees, all of whom work a basic 35 hour week at a budgeted labour rate of £8.00 per hour. Any overtime will be payable at a rate of £12.00 per hour.<BR><BR> CENTURY DECADE<BR>Budgeted Sales Price See Below See Below<BR>Budgeted sales (in barrels): - quarter 1 4,800 5,100<BR> - quarter 2 5,100 5,400<BR>Raw material per barrel (litres) 8 12<BR>Budgeted labour hours per barrel 2 3<BR>Opening stocks of finished goods (barrels) 710 1,050<BR>Closing stocks of finished goods (expressed<BR>in days sales next quarter) 10 12<BR><BR>Opening stocks of raw materials 10,032 litres<BR>Closing stocks of raw materials 10,560 litres<BR>Budgeted cost of raw materials £15.25 per litre<BR>Amount of faulty production discovered on completion<BR>(with nil scrap value) 5%<BR><BR>Sales Price Information:<BR><BR>Prices of both products have not changed for some time and the marketing director has advised you that you should build price increases into the budgets in line with inflation.<BR><BR>The last time prices were altered was in January 1999 when the RPI stood at 162.0. The RPI at the start of the first quarter next year (i.e. January 2002) is expected to stand at 180.0.<BR><BR>Prices currently are £234.00 per barrel of "Century" and £342.00" <BR>of "Decade".<BR><BR>Tasks:<BR><BR>For quarter 1 (to 31.03.02)<BR><BR>1. Using the RPI figures provided calculate the budget prices for the "Century" and the "Decade".<BR><BR>2. Calculate the finished goods stocks of both products (in barrels)<BR><BR>3. Calculate the number of production hours available before incurring overtime.<BR><BR>4. Prepare: a) the Sales Revenue budget for both products.<BR> b) the Production budget (in barrels) for both products.<BR> c) the Materials Purchases budget (in litres and cost).<BR> d) The labour budget (in hours and cost)<BR><BR><BR>If anybody could help me with this it would be most appreciated.<BR><BR>sebula<BR><BR><BR><BR><BR>

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budgets

sebula<BR><BR>I suspect that if you had a layout to use to complete this question you would be able to manage it.<BR><BR>The price question requires you to <BR>(1) find the % increase in the RPI and and <BR>(2)use this to increase the price of eavch barrel<BR><BR>Eg Century<BR>£234 divide by 162 and multiply by 180 to get the inflation adjusted price.<BR><BR>Finished goods stock<BR>There are 60 days (12 weeks of 5 days) per period, you need 10 days sales of the Century in the next period<BR>Next period sales (5,100 barrels) times 10 days sales divided by 60 days in the period<BR><BR><BR>Production hours available<BR>Number of Staff x Number of hours per week x Number of weeks<BR><BR>The budgets - you really need a standard layout<BR>(I'll pop one over to you as an attachment if you email me)<BR><a target=new class=ftalternatingbarlinklarge href="mailto:sandy.hood@chichester.ac.uk">SandyHood</a><BR><BR><BR>

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budgets

hi, many thanks for your help.<BR><BR>my e-mail address is steviecosty@tiscali.co.uk or costy_ste@hotmail.com<BR><BR>thanks once again<BR><BR>sebula