MANAGEMENT ACCOUNTING

The following cost information of Sabah Kandazan Bhd for the months ended 31st May and 30 June 2020 are as follows: May June Sales (units) 80,000 90,000 RM RM Sales revenue 2,080,000 2,340,000 Less Total Cost Direct materials 560,000 630,000 Indirect materials 150,000 150,000 Direct labour 480,000 540,000 Indirect labour 40,000 40,000 Rent 35,000 35,000 Depreciation 15,000 15,000 Inspection costs 11,000 11,000 Electricity 120,000 135,000 Supervisors' salaries 290,000 320,000 1.701.000 1,876.000 Profit/Loss 379,000 464,000 (a) Explain THREE (3) differences between fixed and flexible oudget. (3 marks) (b) Prepare a budget in the same format for the month ended 31 March 2016 assuming that the factory will manufacture and sell 100,000 units during the month. (7 marks) June Sales (units) 80,000 90,000 RM RM Sales revenue 2,080,000 2,340,000 Less Total Cost Direct materials 560,000 630,000 Indirect materials 150,000 150,000 Direct labour 480,000 540,000 Indirect labour 40,000 40,000 Rent 35,000 35,000 Depreciation 15,000 15,000 Inspection costs 11,000 11,000 Electricity 120,000 135,000 Supervisors' salaries 290,000 320,000 1.701.000 1,876.000 Profit/Loss 379,000 464,000 May