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    Group Assignment - Budgeting

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    Pramodi Anjalika
    1. Budgets contribute to organizational success in 5 key ways: by planning activities and costs, motivating performance, communicating goals, monitoring progress, and highlighting deviations. 2. The document provides production, material, and financing budgets for Delta Ltd's products P, Q, and R based on budgeted sales, opening/closing stocks, material consumption per unit, and beginning/ending raw material stocks. 3. Johnson Company's sales, stock, expenses, and payment policies are given to prepare purchase and cash budgets for August-October 2022, showing expected unit purchases, cash inflows and outflows.

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    Group Assignment - Budgeting

    Uploaded by

    Pramodi Anjalika
    4 views2 pages
    1. Budgets contribute to organizational success in 5 key ways: by planning activities and costs, motivating performance, communicating goals, monitoring progress, and highlighting deviations. 2. The document provides production, material, and financing budgets for Delta Ltd's products P, Q, and R based on budgeted sales, opening/closing stocks, material consumption per unit, and beginning/ending raw material stocks. 3. Johnson Company's sales, stock, expenses, and payment policies are given to prepare purchase and cash budgets for August-October 2022, showing expected unit purchases, cash inflows and outflows.

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    Group Assignment -Budgeting

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    1. Budgets contribute to organizational success in 5 key ways: by planning activities and costs, motivating performance, communicating goals, monitoring progress, and highlighting deviations. 2. The document provides production, material, and financing budgets for Delta Ltd's products P, Q, and R based on budgeted sales, opening/closing stocks, material consumption per unit, and beginning/ending raw material stocks. 3. Johnson Company's sales, stock, expenses, and payment policies are given to prepare purchase and cash budgets for August-October 2022, showing expected unit purchases, cash inflows and outflows.

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    © All Rights Reserved
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    Download as pdf or txt
    4 views2 pages

    Group Assignment - Budgeting

    Uploaded by

    Pramodi Anjalika
    1. Budgets contribute to organizational success in 5 key ways: by planning activities and costs, motivating performance, communicating goals, monitoring progress, and highlighting deviations. 2. The document provides production, material, and financing budgets for Delta Ltd's products P, Q, and R based on budgeted sales, opening/closing stocks, material consumption per unit, and beginning/ending raw material stocks. 3. Johnson Company's sales, stock, expenses, and payment policies are given to prepare purchase and cash budgets for August-October 2022, showing expected unit purchases, cash inflows and outflows.

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    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
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    of 2

    Group Assignment

    01. Explain the 5 key contribution of budgets in success of the organization.

    02. The following information were extracted from Delta Ltd with related to Products, P,
    Q, R.

    P Q R

    Budgeted Sales(Units) 5500 7500 3500

    Opening stock (FG) 3800 4000 1500

    Closing stock (FG) 4100 3200 2500

    Budgeted Material Consumption 5.5kg 4 kg 6 kg


    per unit

    At the beginning Raw material stock will be 34800kg.


    Raw Material closing stock is 44 400kg.
    Budgeted Material Cost is Rs 25 per kg.
    Required;

    a) Prepare production budget


    b) Prepare Material budget.
    c) If Delta LTD has only LKR of 2,000,000 as working capital, how much the
    organization needs to finance to complete the purchase of Raw Materials?

    03. Johnson Company buys and sells one item called 'X'. Company's future estimates are
    as follows.
    (i) Year 2022 - August September October November
    Sales units - 5,000 7,000 10,000 15,000

    Selling price - Rs. 100 per unit


    (ii) Stock policy - Equal to 20% of next month sales.
    (iii) Sales policy - From the total sales 50% in cash, balance 50% on
    credit.

    1
    (iv) Collection from credit sales;
    - 50% after one month
    - 50% after two months

    (v) Expected monthly expenses, payable in the same month


    -Administration -Rs. 60,000 including Rs. 10,000 depreciation
    -Selling -Rs. 25,000 plus 10% on gross sales income

    (vi) Goods purchased from the supplier at Rs. 60 per unit. Based on the
    agreement, payment should be made after one month. (Credit period one
    month)

    (vii) Balances as at 01st August 2022.


    Cash and bank balance - Rs. 50,000
    Finish goods - 1000 units Rs. 70,000
    Trade debtors - from June sales Rs. 100,000
    - from July sales Rs. 270,000
    Trade creditors - Rs. 300,000

    Required;
    (a) Purchase budget (in units) for the months of August, September and October,
    year 2022 in columnar form.

    (b) Cash budget for the months of August, September and October, year 2022 in
    columnar form.

    04. Prepare the cash budget for next three months of 2023, April May and June of a
    student who is studying at Eastern University in the first year.

    05. Select any of the food item that you prepare at home, and submit a material usage and
    purchase budget for producing 100 units of the food item.

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