Intermediate: Preparation of functional budgets Kerryblue Ltd is a company manufacturing two products using one type of material and one grade of labour. Shown below is an extract from the company's working perpers for the next period's budget.

The budgeted wage rate for the direct workers ts £4 per hour for a 40·hour week, overtime premium is 50% and there are 65 direct operatives.
The target productivity ratio (or efficiency ratio) for the productive hours worked by the direct operatives in actually manufacturing the products is 90%; in addition the amount of non·productive down· time is budgeted at 20% of the productive hours worked.
There are twelve S·day weeks in the budget period and it is antictpated that sales and production will occur evenly throughout the whole period.
At the beginning of the period it is anticipated that the stocks will be:

The target closing stocks, expressed in terms of the anticipated activity during the budget period are:

Required:

(a) Calculate the material purchases budget and the wages budget for the direct workers, showing both quantities and values, for the next period. (16 marks)

(b) Describe the additional information required in order to calculate the weekly cash disbursements for materials and wages during the above budget period.

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Budgeted sales (units) Budgeted material consumption, per product (kg) Product K Product B 3000 4500 6 2