Sinar Sdn Bhd (SSB) manufactures and sells two types of automobile batteries, the Heavy Duty (HD) and the Long Life (LL). Each unit of battery consumes two types of material, M1 and M2.SSB is preparing its annual budget for the year ending December 31, 2019. The Assistant Accountant provides the following data:

Product

HD

Product

LL

Sales budget:

Sales revenue

RM9,000,000

RM4,800,000

Unit selling price

RM20.00

RM30.00

Production budget:

Beginning inventory finished goods

20,000 units

10,000 units

Direct labour budget:

Direct Labour time per unit

0.4 hr

0.6 hr

Direct labour rate per hour

RM10.00

RM10.00

Direct material Budget:

M1 - RM2.00 per kg

2 kg

3kg

M2 - RM3.00 per kg

2.5 kg

4 kg

Beginning direct Material:

M1 - 500,000kg

M2 - 300,000kg

Additional information:

Ending inventory for finished products will be 10% higher than its beginning inventory and ending inventory for materials will be 20% lower than its beginning inventory.

Required:

a)Prepare production budget for each product.(10 marks)

b)Prepare Material purchases budget (M1 and M2).(14 marks)

Prepare direct labour budget for each product.