Nama
: Panetrir Bungkes
Mata Kuliah : Akuntansi Menejemen dan Biaya
Dosen
: Dr. Drs Hasan Basri M.Com
THE MASTER BUDGET
SALES BUDGET
Breakers, Inc. is preparing budgets for the quarter ending June 30. Budgeted sales for the next
five months are:
April
May
June
Quarter
April
May
June
Quarter
April
20,000 units
May
50,000 units
Budgeted
Budgeted
sales
20,000
50,000
30,000
100,000
June
30,000 units
sales(units)
(units)
20,000
50,000
30,000
100,000
Selling
price
July
25,000 units
Selling price
per
$$
10
10
10
10
August
15,000 units.
perunit
unit
10 $$
10 $$
10 $$
10
Total
The selling price is $10 per unit.
Total
Revenue
Revenue
$$200,000
200,000
$$500,000
500,000
$$300,000
300,000
$$1,000,000
1,000,000
PRODUCTION BUDGET
The management of Breakers, Inc. wants ending inventory to be equal to 20% of the following
month’s budgeted sales in units. On March 31, 4,000 units were on hand.Let’s prepare the
production budget.
May sales
Desired percent
Desired inventory
50,000 units
20%
10,000 units
Sales in units
Sales in units
Add: desired
Add: desired
end. inventory
end. inventory
Total needed
Total needed
Less: beg.
Less: beg.
inventory
inventory
Units to be
Units to be
produced
produced
April
April
20,000
20,000
May
May
50,000
50,000
June
June
30,000
30,000
Quarter
Quarter
100,000
100,000
10,000
10,000
30,000
30,000
6,000
6,000
56,000
56,000
5,000
5,000
35,000
35,000
5,000
5,000
105,000
105,000
4,000
4,000
10,000
10,000
6,000
6,000
4,000
4,000
26,000
26,000
46,000
46,000
29,000
29,000
101,000
101,000
DIRECT-MATERIAL BUDG
• At Breakers, each unit of product requires 0.1 hours of direct labor.
• The Company has a “no layoff” policy so all employees will be paid for 40 hours of work
each week.
• In exchange for the “no layoff” policy, workers agreed to a wage rate of $8 per hour
regardless of the hours worked (No overtime pay).
• For the next three months, the direct labor workforce will be paid for a minimum of 3,000
hours per month.
Let’s prepare the direct labor budget.
July Production
Sales in units
Add: desired ending inventory
Total units needed
Less: beginning inventory
Production in units
25,000
3,000
28,000
5,000
23,000
June Ending Inventory
July production in units
23,000
Materials per unit
5
Total units needed
115,000
Inventory percentage
10%
June desired ending inventory
11,500
Production in units
Materials per unit
Production needs
Add: desired
ending inventory
Total needed
Less: beginning
inventory
Materials to be
purchased
April
26,000
5
130,000
May
46,000
5
230,000
June
29,000
5
145,000
Quarter
101,000
5
505,000
23,000
153,000
14,500
244,500
11,500
156,500
11,500
516,500
13,000
23,000
14,500
13,000
140,000
221,500
142,000
503,500
DIRECT-LABOR BUDGET
• At Breakers, each unit of product requires 0.1 hours of direct labor.
• The Company has a “no layoff” policy so all employees will be paid for 40 hours of work
each week.
• In exchange for the “no layoff” policy, workers agreed to a wage rate of $8 per hour
regardless of the hours worked (No overtime pay).
• For the next three months, the direct labor workforce will be paid for a minimum of 3,000
hours per month.
Let’s prepare the direct labor budget.
April
April
Production in units
26,000
Production in units
26,000
Direct labor hours
0.10
Direct labor hours
0.10
Labor hours required
2,600
Labor hours required
2,600
Guaranteed labor
Guaranteed labor
hours
3,000
hours
3,000
Labor hours paid
3,000
Labor hours paid
3,000
Wage rate
$
8
Wage rate
$
8
Total direct labot cost $ 24,000
Total direct labot cost $ 24,000
May
May
46,000
46,000
0.10
0.10
4,600
4,600
June
June
29,000
29,000
0.10
0.10
2,900
2,900
Quarter
Quarter
101,000
101,000
0.10
0.10
10,100
10,100
3,000
3,000
4,600
4,600
$
8
$
8
$ 36,800
$ 36,800
3,000
3,000
3,000
3,000
$
8
$
8
$ 24,000
$ 24,000
10,600
10,600
$
8
$
8
$ 84,800
$ 84,800
OVERHEAD BUDGET
Here is Breakers’ Overhead Budget for the quarter.
April
Indirect labor
Indirect material
Utilities
Rent
Insurance
Maintenance
$
$
17,500
7,000
4,200
13,300
5,800
8,200
56,000
May
$
$
26,500
12,600
8,400
13,300
5,800
9,400
76,000
June
$
$
17,900
8,600
5,200
13,300
5,800
8,200
59,000
Quarter
$
$
61,900
28,200
17,800
39,900
17,400
25,800
191,000
SELLING AND ADMINISTRATIVE EXPENSE BUDGET
• At Breakers, variable selling and administrative expenses are $0.50 per unit sold.
• Fixed selling and administrative expenses are $70,000 per month.
• The $70,000 fixed expenses include $10,000 in depreciation expense that does not
require a cash outflows for the month.
Sales in units
Sales in units
Variable S&A rate
Variable S&A rate
Variable expense
Variable expense
Fixed S&A
Fixed S&A
expense
expense
Total expense
Total expense
Less: noncash
Less: noncash
expenses
expenses
Cash
Cash
disbursements
disbursements
April
April
20,000
20,000
$
0.50
$
0.50
$ 10,000
$ 10,000
May
May
50,000
50,000
$
0.50
$
0.50
$ 25,000
$ 25,000
June
June
30,000
30,000
$
0.50
$
0.50
$ 15,000
$ 15,000
Quarter
Quarter
100,000
100,000
$
0.50
$
0.50
$ 50,000
$ 50,000
70,000
70,000
80,000
80,000
70,000
70,000
95,000
95,000
70,000
70,000
85,000
85,000
210,000
210,000
260,000
260,000
10,000
10,000
10,000
10,000
10,000
10,000
30,000
30,000
$ 70,000
$ 70,000
$ 85,000
$ 85,000
$ 75,000
$ 75,000
$ 230,000
$ 230,000
CASH RECEIPTS BUDGET
• At Breakers, all sales are on account.
• The company’s collection pattern is:
70% collected in the month of sale,
25% collected in the month following sale,
5% is uncollected.
• The March 31 accounts receivable balance of $30,000 will be collected in full.
April
April
Accounts rec. - 3/31
$ 30,000
Accounts rec. - 3/31
$ 30,000
April sales
April sales
70% x $200,000
140,000
70% x $200,000
140,000
25% x $200,000
25% x $200,000
May sales
May sales
70% x $500,000
70% x $500,000
25% x $500,000
25% x $500,000
June sales
June sales
70% x $300,000
70% x $300,000
Total cash collections $ 170,000
Total cash collections $ 170,000
May
May
June
June
140,000
140,000
50,000
50,000
$ 50,000
$ 50,000
350,000
350,000
$ 400,000
$ 400,000
Quarter
Quarter
$ 30,000
$ 30,000
$ 125,000
$ 125,000
350,000
350,000
125,000
125,000
210,000
210,000
$ 335,000
$ 335,000
210,000
210,000
$ 905,000
$ 905,000
BUDGETED INCOME STATEMENT
Bre a ke rs, Inc.
Bre
a ke rs, Sta
Inc.te me nt
Budge te d
Income
Budge
te
Income
Sta te
nt 30
For the
Thre
edMonths
Ende
d me
June
For the Thre e Months Ende d June 30
Re ve nue (100,000 × $10)
$ 1,000,000
Re ve
nue
(100,000
$ 1,000,000
Cost
of
goods
sold × $10)
460,000
Cost
of
goods
sold
460,000
Gross ma rgin
540,000
Gross
ma
rgin
540,000
Ope ra ting e x pe nse s:
Ope
ra
tingae
x pe
nse s: e x pe nse s
Se
lling
nd
a dmin.
$
260,000
Se lling
a dmin. e x pe nse s
$
260,000
Inte
re st ea
xnd
pe nse
838
rera
stting
e x pe
nse
838
TotaInte
l ope
ex
pe nse s
260,838
Tota
l
ope
ra
ting
e
x
pe
nse
s
260,838
Ne t income
$
279,162
Ne t income
$
279,162
BUDGETED STATEMENT OF CASH FLOWS
April
Cash flows from operating activities:
Cash receipts from customers
Cash payments:
To suppliers of raw material
For direct labor
For manufacturing-overhead expenditures
For selling and administrative expenses
For interest
$
May
170,000
$
(40,000)
(24,000)
(56,000)
(70,000)
-
Total cash payments
$
(72,300)
(36,800)
(76,000)
(85,000)
-
(190,000)
(20,000)
400,000
June
(185,000)
(84,800)
(191,000)
(230,000)
(838)
(231,538)
Net cash used by investing activities
Cash flows from financing activities:
Payment of dividends
Principle of bank loan
Repayment of bank loan
$
Net cash provided by financing activities
$
10,000
$
13,800
$
(48,800)
$
Net increase in cash
Balance in cash, beginning
$
(10,000)
40,000
$
30,000
$
6,362
30,000
$
(3,638)
40,000
Balance in cash. end of month
$
30,000
$
30,000
$
36,362
$
36,362
(143,700)
$
(25,000)
35,000
-
(143,700)
103,462
(691,638)
$
-
$
905,000
Net cash flow from operating activities
Cash flows from investing activities:
Purchase of equipment
-
129,900
$
(72,700)
(24,000)
(59,000)
(75,000)
(838)
(270,100)
$
335,000
Qua rter
$
(48,300)
$
13,800
-
(48,300)
213,362
(192,000)
$
(48,800)
(192,000)
(25,000)
48,800
(48,800)
-