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Mr John pls help with the working to come up to the correct figure
task 2
pls correct me
opening Q4 is closing Q3 : 3250000/13= 250000
production (missing figure) (2250000?)
closing 150,000
Selling forecast Q4 2275000Task 3
opening Q3 = Q2/13 = 2275000/13=175000
producing 3175000
closing 175000
Budgeted Cost for row material usage (57150000?)task 4
revised opening 325000
revised closed 0units?Have also question regarding Q3 – pls help Mr John
how is the working to get the budgeted production units?
how do we get the figure actual units sold 1,200 (that it is less it s clear because of Adv)
actual sales revenue $1640000
and production was 100u less than budgeted?task 2:
opening Q4 is closing Q3: 2275000/13
(closing Q3 is 5 days demand for the NEXT quarter (i.e. quarter 4)task 3:
Opening Q3 is Q3/13 (for the same reason as above)task 4:
The most they can buy is enough for 6,600,000/3 = 2.2M units.
In Q3 they want to sell 3.25M units and have 325,000 opening inventory.
So…..they cannot buy enough to be able to see all of those and so the closing inventory will be zero.The fixed overhead volume variance is 2000 adverse.
The standard cost per unit for fixed overheads is 20.
So it means they must have produced 2000/20 = 100 units less than budget.Mr John, task 2 /4 clear now 🙂
but
Task 3:
still not clear
we want sell 3250000*56=182000000
minus opening 250000*56=14000000(already finished units no need to budget raw material)
plus closing 175000*56=9800000we have to produce 3175000*56=177800000+extra 98000000 (closing inv) = ?
please help
Why on earth are you bringing in 56?
$56 is the selling price – the question asks for the cost of raw material.If they are producing 3175000 units and each unit requires 3 kg at a cost of $6 per kg, then the total cost is 3175000 x 3 x 6 = $57150000
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