Flexible Budget 60 75 19,50,000 $11,50,000 90 100 15,25,000 13,75,000 Percentage of capacity worked Sales revenue Less: Costs: Variable costs: Materials Labour Other expenses (A) Total variable cost 2,88,000 3,07,200 45,600 6,40,800 3,60,000 3,84,000 57,000 8,01,000 4,32,000 4,60,800 68,400 9,61,200 4,80,000 5,12,000 76,000 10,68,000 j52 Fixed costs: Salaries 84.000 84,000 84,000 84,000 Rent and rates 56,000 56,000 56,000 56,000 Depreciation 70,000 70,000 70,000 70,000 Other administrative expenses 80,000 80,000 80,000 80,000 (B) Total fixed cost 2,90,000 2,90,000 2,90,000 2,90,000 Total cost (A + B) 9,30,800 10,91,000 12,51,200 13,58,000 Forecast profits 19,200 59,000 1,23,800 1,67,000 P.17.7 A company is drawing its production plan for the next year in respect of two of its products "Gamma' and 'Delta'. The company's policy is not to carry any closing work-in-process (WIP) at the end of any month. However, its policy is to hold a closing stock of finished goods at 50 per cent of the anticipated quantity of sales of the succeeding month. For the next year, the company's budgeted pro- duction is 20,000 units of Gamma' and 25,000 units of Delta'. The following is the estimated cost data: Particulars Gamma Delta Direct material per unit *50 280 Direct labour per unit 20 Other manufacturing expenses apportionable to each type of product based on production 2,00,000 3,75,000 The estimated units to be sold in the first 7 months of the next year are as under: Particulars April May June July August September October Gamma 900 1100 1400 1800 2200 2200 1800 Delta 2900 2900 2500 2100 1700 1700 1900 You are required to (3) Prepare a production budget showing month-wise number of units to be manufactured: (b) Present a summarised production cost budget for the half-year ending September 30. 80