3.

Ukraine steel company is in the process of preparing the Cash Budget for the last four months of 2020 that is September to December. The following information has been made available.

Sept.Oct.Nov.Dec.

(i) Projected Sales (Units)12,00013,00013,00014,000

(ii) Selling Price is GHS5 per unit but it is expected to drop by 5% from 1st November.

(iii) Receipt for goods sold is as follows; 20% in the month of sales, 60% the following month after sales and the balance in the second month after sales. Bad debt is estimated at 5% of sales values.

(iv) Purchases of goods at GHS3.00 per unit per month are as follows: September 14,000 units, October 14,000 units, November 14,400 units and December 13,000 units.

(v) Goods purchased are paid one month in arrears.

(vi) Monthly expenses estimated at 24% on sales revenue are paid in the month in which the expense is incurred.

(vii) The company plans to buy a delivery van at a cost of GHS54,000.00. 40% of the cost is to be paid in October and balance in January 2018.

(viii) The Director withdraws GHS6,000.00 monthly for personal expenses.

(ix) Extracts from August figures are as follows:

Trade receivable of GHS92,000.00 out of which GHS20,000.00 is part of July sales before the bad debt.

Creditors for goods GHS20,000.00

Cash GHS7,000.00.

Required:

(a) Prepare the monthly CASH BUDGET for the four months ending December, 2020.

UNIVERSITY OF PROFESSIONAL STUDIES, ACCRA COST AND MANAGEMENT ACCOUNTING You are a student of management accounting of the University of Professional Studies, Accra (UPSA) and have a good understanding of budgeting and budgeting control. On a management trainee program, you are presented with the following problems on budget preparation to resolve. Critically consider each of the problems presented and resolve them accordingly Question 1 - Functional Budget Pebbles Company Limited produces two products, Alpha and Beta. The estimates sales for next year are 5,000 units of Alpha and 3,000 units of Beta and is expected to be sold at GHS 92.5per unit and GHS 95 per unit respectively. The following budgeted data were obtained from the various departments Stock Finished Products: Alpha (units) Finished Products: Beta (units) Opening Stock Closing stock 100 110 500 350 Direct Material: Bum (kg) Direct Material: Soo (kg) 5.000 5.000 6,000 1,000 Beta 9 kg Requirement per unit Raw material Bun (GHS 0.72 per kg) Raw material Soo (GHS 1.56 per kg) Skilled Labour (GHS 2.20 per hr) Unskilled Labour (GHS 1.55 per hr) Alpha 12 kg 6 kg 8 hrs 4 hrs 8 kg 12 hrs 10 hrs Production overhead are absorbed using the following absorption rate Variable Production Overhead GHS 1.54 per labour hour Fixed Production Overhead GHS 0.54 per labour hour Prepare the various functional UNIVERSITY OF PROFESSIONAL STUDIES, ACCRA COST AND MANAGEMENT ACCOUNTING You are a student of management accounting of the University of Professional Studies, Accra (UPSA) and have a good understanding of budgeting and budgeting control. On a management trainee program, you are presented with the following problems on budget preparation to resolve. Critically consider each of the problems presented and resolve them accordingly Question 1 - Functional Budget Pebbles Company Limited produces two products, Alpha and Beta. The estimates sales for next year are 5,000 units of Alpha and 3,000 units of Beta and is expected to be sold at GHS 92.5per unit and GHS 95 per unit respectively. The following budgeted data were obtained from the various departments Stock Finished Products: Alpha (units) Finished Products: Beta (units) Opening Stock Closing stock 100 110 500 350 Direct Material: Bum (kg) Direct Material: Soo (kg) 5.000 5.000 6,000 1,000 Beta 9kg Requirement per unit Raw material Bun (GHS 0.72 per kg) Raw material Soo (GHS 1.56 per kg) Skilled Labour (GHS 2.20 per hr) Unskilled Labour (GHS 1.55 per hr) Alpha 12 kg 6 kg 8 hrs 4 hrs 8 kg 12 hrs 10 hrs Production overhead are absorbed using the following absorption rate Variable Production Overhead GHS 1.34 per labour hour Fixed Production Overhead GHS 0.54 per labour hour Prepare the various functional