Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

Please explain how to get each answer Coleraine Plc manufactures Product Omega at its factory in Portrush, Northern Ireland Its Management Accountant has been asked

image text in transcribedPlease explain how to get each answer
Coleraine Plc manufactures Product Omega at its factory in Portrush, Northern Ireland Its Management Accountant has been asked to prepare budgets for the next three months, June to August 2016. Product Omega has the following cost details: Forecast sales units for the next four months are expected to be as follows: You have been provided with the following additional information: (i) Opening stock of finished goods must be equal to 20% of the following month's sales units. (ii) Closing stock in August must be equal to 10% of September sales units. (iii) Opening stocks of finished goods in June 2016 are expected to be 3.000 units with a value of 387,000 (iv) Opening stocks of Material A and B in June 2016 which will be bought in at the end of May 2016 at the prices noted above per kilo and are expected to be 18,000 kilos and 15,000 kilos respectively. These prices are not expected to change during the budget period. (v) Opening stocks of Material A and B will remain at the same level as at the start of June 2016. (vi) The hourly labour rate noted above will apply throughout the period of three months. Required (a) Prepare the following budgets for June, July and August 2016 and in total for the three month period: (i) Production Budget in units (ii) Material usage budget (for A & B) in kilos (iii) Production Budget in money terms (b) Calculate the monetary value of the Closing stock of finished goods at the end of August 2016 and the value of cost of sales for the three month period. (c) Identify and explain six benefits of a budgetary control system

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Auditing Beyond Compliance Using The Portable Universal Quality Lean Audit Model

Authors: Janet Bautista Smith

1st Edition

0873898400, 9780873898409

More Books

Students also viewed these Accounting questions