Answered step by step
Verified Expert Solution
Question
1 Approved Answer
Please Solve It correctly ! Illustration 5. P Ltd. manufactures two products using one type of material and one grade of labour. Shown below is
Please Solve It correctly !
Illustration 5. P Ltd. manufactures two products using one type of material and one grade of labour. Shown below is an extract from the company's working papers for the next period's budget : Particulars Product Product B Budgeted sales (unit) 3.600 Budgeted material consumption per product (kg.) 5 3 Budgeted material cost Rs. 12 per kg. Standard hours allowed per product 5 4 Budgeted wage rate Rs. 8 per hour 1.800 Overtime premium is 50% and is payable, if a worker works for more than 40 hours a week. There are 90 direct workers. The target productivity ratio (or efficiency ratio) for the productive hours worked by the direct workers in actually manufacturing the products is 80%; in addition the non-productive dow time is budgeted at 20% of the productive hours worked. There are twelve 5-day weeks in the budget period and it is anticipated that sales and production will occur evenly throughout the whole period. It is anticipated that stock at the beginning of the period will be : Product A 1.020 units : Product B 2,400 units; Raw material 4,300 kgs. The target closing stock, expressed in terms of anticipated activity during budget period are : product A 15 days' sales; Product B 20 days' sales; Raw material 10 days consumption. Required: Calculate (a) the material purchases budget, and (b) the wages budget for the direct workers. showing the quantities and values, for the next periodStep by Step Solution
There are 3 Steps involved in it
Step: 1
Get Instant Access to Expert-Tailored Solutions
See step-by-step solutions with expert insights and AI powered tools for academic success
Step: 2
Step: 3
Ace Your Homework with AI
Get the answers you need in no time with our AI-driven, step-by-step assistance
Get Started