Profit Planning and Control :Developing Revenue Budget

Problem :Emami Cosmetics manufactures and sells two beautification cream, Fair and Lovely. In July 2019, Companys Budget Department gathered the following data in order to prepare budgets for 2020:

2020 Projected Sales

Product	Units	Price
Fair	51000	Rs 310
Lovely	39000	Rs 320
Stocks Positions	Opening	Closing
Product	January1, 2020	December 31, 2020
Fair	18000	23000
Lovely	7000	8000
To produce 1 unit of Fair and Lovely, the following direct materials are used:
		Amount used per Unit
Direct material	Unit	Fair	Lovely
A	Kg	5	6
B	Kg	3	4
C	Kg	1	2

Projected data for 2020 with respect to direct materials are as follows:

Direct material	Purchase Price	Opening Inventories January 1, 2020	Closing Inventories December 31, 2020
A	Rs.13	31,000 kg	35,000 kg
B	Rs.6	29,000 kg	31,000 kg
C	Rs.4	6,000 kg	6,000 kg

Projected direct manufacturing labor requirements and rates for 2020 are as follows:

Product	Hours per Unit	Rate per hour
Fair	3	Rs.13
Lovely	4	Rs.17

Manufacturing overhead is allocated at the rate of Rs.28 per direct manufacturing labour-hour.

Prepare the following budgets:

1. Revenue budget( in Rs.)
2. Production budget (in units)
3. Direct materials purchases budget (in quantities)
4. Direct materials purchases budget (in Rs.)
5. Direct manufacturing labour budget (in Rs.)
6. Value of budgeted finished goods inventory at December 31, 2020 (in Rs.)