Exercise 1 (Notes and Excercises on budgets)

Sales Budget
Units R/u Total
Om 22000 150 3300000
Dom 40000 160 6400000
Krom 30000 220 6600000
16300000

Production Budget
Om Dom Krom
Sales 22000 40000 30000
Plus: Closing Stock 11000 12000 8000
Required 33000 52000 38000
Less: Opening Stock 8000 10000 9000
Produce 25000 42000 29000

Material Budget
X Y Z
Prod. OM 25000 75000 150000
Prod. Dom 0 84000 336000
Prod. Krom 116000 145000 29000
Production requirm. 141000 304000 515000
Plus: Closing Stock 5000 12000 13000
Required 146000 316000 528000
Less: Opening Stock 6000 15000 8000
Units to buy 140000 301000 520000
R/u 10 8 11
Purchase in Rand R 1,400,000 R 2,408,000 R 5,720,000 R 9,528,000

Direct Labour
Om Dom Krom
Production 25000 42000 29000
Hours/unit 3 6 8
Hours required 75000 252000 232000 559000
Rate/hour 8 4.5 9.5
Labour cost R 600,000 R 1,134,000 R 2,204,000 R 3,938,000