 Question: 1- Sales Budget:

Bolan Engineering limited produces and sells three types of products. The sales manager
provides the following data for next quarter, ending March 31, 2021:
Products Seliing price Units
A Rs 110 200
B 125 180
C 140 160
Budget quarterly sales distributed of all products as follows:
January, 2021: 35%
February, 2021 20%
March, 2021 45%

Required:
Prepare quarterly sales Budget for the quarter ending 31/03/2021, showing month wise
and total for the quarter.
……… ……….
 Question: 2- Production Budget:
Habib Motor Cycles Company is planning to prepare their production budget for the
first quarter ending March 31, 2021.
For this purpose the following data is estimated:
Sales forecast for first 4 months of next year are as follows:
January, 2021 = 2,500 units
February, 2021 = 3,000 “
March, 2021 = 3,300 “
April, 2021 = 4,000 “
Additional information:
 Sales manager wants to keep ending inventory of finished goods at each month
end equal to 40% sales of the next month.
 Expected finished goods inventory on December 31, 2020 = 1,000 units.

Required:
Prepare a production budget for first quarter ending March 31, 2021, showing month
wise units and also total units for the first quarter.
………….. …………..

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 Question: 3- Raw materials purchase Budget:
Agri-Auto limited is planning to prepare direct materials purchase Budget for the 2nd
quarter ending June 30, 2021.
For this purpose the following data is estimated:
Production forecast for first 4 months of next year are as follows:
April, 2021 = 3,000 units
May, 2021 = 3,500 “
June, 2021 = 3,800 “
July, 2021 = 4,000 “
Additional information:
 Each unit of production requires 4 kgs of direct materials @ Rs50 per K.G
 Production manager wants to keep ending inventory of Raw materials at each
month end equal to 30% Production needs of direct materials for the next
month.
 Expected direct materials inventory on March 31, 2021 = 4,500 K.G

Required:
Prepare a direct materials purchase Budget for 2nd quarter ending June 30, 2021,
showing month wise figures in K.G, and amount and also total figure for the 2nd
quarter.
………….. …………..

 Question: 4- Direct labor Budget:

Junaid wood shop produces wooden dining table. Each dining table requires 6 hours of
direct labor. The labor rate per hour is Rs250. The expected production in next 3
months follows:
January, 2021: .………………. 225 units
February, 2021: ……………… 260 units
March, 2021: ………………… 275 units
Required:
Prepare Direct labor Budget for first quarter ending March 31, 2021, showing month
wise figures in hours, and amount and also total figure for the first quarter.

………….. …………..

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