The following information has been made available from the records of Tata Tools Ltd. for the last six months of 2009 (and of only the sales of January 2009) in respect of product ‘X’:

(i) Units to be sold in different months are:

July 2009 = 1,100; November 2009 = 2,500 August = 1,100 December 2009 = 2,300 September = 1,700; January 2010 = 2,000 October = 1900;

(ii) There will be no work in progress at the end of any month.

(iii) Finished units equal to half of sales for the next month will be in stock at the end of every month (including June 2009).

(iv) Budgeted production and production cost for the year ending 31st December, 2009 are as follow:

Production (units) Rs. 22,000 Direct materials per unit Rs. 10.00 Direct wages per unit Rs. 4.00 Direct Wages per unit Rs. 4.00 Total Factory overhead apportioned to product = Rs. 88,000. It is required to prepare:

(a) a production budget for each of the last six months of 2003, and

(b) a summarised production cost budget for the same period.
[Ans.:

(a) Production (in units) July = 1100, Aug. = 1400, Sept. = 1800; Oct. =2200; Nov.= 2400; Dec. = 2150 units

(b) Total Production cost = Rs. 1,98,900 ]