Present the budget of the function for the first quarter N (production function), providing all necessary explanations on the intermediate steps

steps

Commercial function

The commercial function employs two people: the commercial manager and a young recruit who has just graduated.

freshly graduated. The gross fixed monthly salaries are 2,000 for the sales manager and 1,400 for the

and 1,400 for the young sales person. In addition, they receive a gross commission

5% of their respective turnover.

The plan is to sell 3,300 units of the finished product during the first quarter of the year, with the following seasonal coefficients

seasonality coefficients:

January: 0.85; February: 1.1; March: 1.05

The sales staff can adjust the selling price according to the customer, but on average it is

40. On the other hand, it is the company's general management that decides on the payment period to be granted to customers.

It is currently 60 days on average.

The fixed assets of the sales function generate a depreciation charge of 1,500

per month.

Other commercial expenses represent 1 per unit sold.

Production function

The production department manages a production workshop and the supply of raw materials. It

employs 3 people: the production manager and two workers. The total gross monthly salary of these 3 people is

of these 3 people represents 5,500 per month. In addition to his responsibility for the workshop, the

In addition to his responsibility for the workshop, the production manager is in charge of supplying the workshop with raw materials.

As a precautionary measure, the company wishes to have a stock of finished products at the end of each month representing 20% of the sales forecast for the month.

20% of the sales expected for the following month. It is planned to sell 1,100 units of the

product in April. The stock is valued on the basis of a production cost of 20.

The production of one unit of product requires an average of 18 minutes of work, knowing that the team

can provide up to 330 immediately productive hours per month. When this production capacity is

production capacity is insufficient, the company calls on a subcontractor who is paid 25 per unit of

product manufactured.

The workshop's depreciation expenses currently amount to 2,000 per month. It is planned to

to buy and put into service in February a new equipment allowing to improve the reliability

quality control of products. This equipment will cost 9,000 and will be depreciated on a straight-line basis over 10

years. The company will pay the supplier a deposit of 25% in January, when the equipment is ordered, and 25% in February when the equipment is delivered.

The company will pay the supplier a deposit of 25% in January when the equipment is ordered, 25% in February when the equipment is received, and the balance in April N.

Other workshop costs are 1.50 per unit manufactured in-house.

The in-house manufacture of one unit of product consumes 2 kg of raw materials, at 2.50 per kg.

The raw material supplier is paid within 30 days.

The raw material stock on 1 January contains 300 kg of raw material. The production manager

wants to have a safety stock of raw materials at the end of January to cover the production of 100 kg of raw materials.

The production manager wants to have a safety stock of raw materials available at the end of January to cover the production of 100 products and then maintain the stock at this level. The raw material stock on 1 January contains 300 kg of raw material. The production manager

wants to have a safety stock of raw materials available at the end of January to cover the production of 100 products.

The production manager wants to have a safety stock of raw materials available at the end of January to cover the production of 100 products and then maintain the stock at this level. The stock of

The raw material stock is valued at a standard purchase cost of 3 per kg.

Balance sheet information as of 1 January N:

The stock of finished product consists of 187 units.

The stock of raw material consists of 300 kg of material.

Trade receivables are expected to be collected in the amount of 40,000 in January and 45,000 in

45,000 in February.

Following a major purchase of fixed assets in the last quarter of N-1, the company has a VAT credit

which the government should pay in January N.

The debts to the supplier of raw materials, the supplier of fixed assets and the social

social security bodies will be paid in January N.