Question
QUESTION 3 (Management Accounting) PT EWAY is a company that produces t-shirts for children. The company has been established since 2011. Fabio as the owner
QUESTION 3 (Management Accounting) PT EWAY is a company that produces t-shirts for children. The company has been established since 2011. Fabio as the owner of the company asks you as the Financial Manager to create a master budget for the first quarter of 2019. The following is information related to the company's policies:
- T-shirts are sold at IDR 125,000/unit. Sales in December 2018 were Rp 1.5 billion. During 2018 sales always increased by 20% every month from the previous month. In 2019, sales are predicted to increase 10% in the first and second months and will decrease 10% in the following months from the previous month.
- The company has an ending inventory policy of finished goods of 10% of the units sold in the following month. In December 2018, the company had an ending inventory of finished goods of 1,250 units.
- To make 1 unit of t-shirt, 2 m of fabric is needed2and roll of thread. The company buys cloth at a price of IDR 140,000/400dm2and thread at a price of IDR 648,000/3 rolls. 1 roll contains 18 rolls of thread.
- The company has an ending raw material inventory policy of 20% of the next month's production needs. The initial inventory of raw materials in January was 2,500 units.
- The direct labor required to make 8 units of t-shirts is 8 hours. Direct labor is paid per 2 hours at IDR 60,000.
- During the first quarter, there were costs incurred by factories and offices. The company has a variable overhead policy of IDR 12,000 per 3 direct labor hours. Apart from that, the company must pay rent for the factory building of IDR 180,000,000 per year. The company also employs security with a total salary of IDR 30,000,000 per semester. Apart from that, the company has factory equipment which was purchased at a cost of IDR 12,000,000, with a residual value of IDR 2,000,000. The equipment was purchased on July 4, 2017, and was depreciated using the straight line method with a useful life of 8 years. Then the company also has an office building which is depreciated using the double declining method and has a useful life of 20 years, purchased in 2017 at a cost of IDR 500,000,000 with no residual value.
Requested: Make it sales budget, production budget, direct material purchase budget (both direct materials), direct labor budget, manufacturing overhead budget, and cost of goods sold budget for PT EWAY in the first quarter of 2019. (Round to the nearest whole).
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