The expenses budgeted for the productions of 10,000 units in a factory are furnished below Per unit Rs Materials 70.25 Labor 20.10 Variables overheads 5 Fixed overheads 1,00,000 Variables expenses (Direct) 13.75 Selling expenses (10% Fixed) Distribution expenses (20% Fixed) Administration expenses (Rs.50,000) Total cost of sale per unit ( to make and sale) 155 Prepare a budget for the production of a. 8,000 units and b. 6000 units, (Assume that administrative expenses are rigid for all levels of production.) following are the actual for the year 1985. Rs Sales 20,000 units @ RS 3 per unit 60,000 Raw material 26,500 Direct labor cost 5,000 Variable overheads 8,000 Fixed overheads 10,000 The management expects the following estimates in 1986. Sales increase to 30,000 units, selling price remaining unchanged. Raw materials prices increase by 10%, wage rate to increase by 10% but labor productivity improves by 5%. Fixed overheads are expected to increase by RS .2000. You are required to prepare the budget for 1986. Production cost of a factory for a year are as follows. Direct Wages Rs 90,000 Direct Materials Rs 1,20,000 Production overheads Fixed Rs.40,000 Variables Rs 60,000 During the forthcoming year, it is anticipated that: The average rate for direct labor renumeration will fall from 90 paisa to 75 paisa per hour Production efficiency will be reduced by 5% Price per unit of direct, materials and other materials and service which comprise