Answered step by step
Verified Expert Solution
Link Copied!

Question

1 Approved Answer

You have a tea stall in operation at Ramna park since 2015. Information of your business in 2018 are as follows: Selling price was BDT

You have a tea stall in operation at Ramna park since 2015. Information of your business in 2018 are as follows:

Selling price was BDT 15 per cup

Average Sales volume was 45 cups per day

Annual sales growth was 10%

Price increases by 10% every year

Monthly average selling and administration cost of the stall was:

Police Commission = BDT 700/month

Rent= BDT 1,200/month

Utility= BDT 100/month

Depreciation= BDT 50/month

During a normal situation, the following growth has been observed:

Raw material cost increases by 12% every year

Labor cost increases by 10% every year

MOH cost increases by 15% every year

Selling and administration cost increases by 4% every year

Make a Master Budget (Sales/Production/RM/Labor/MOH/Selling & Administrative/Cash budget) for the year 2019 (Pre CORONA virus year ) and another Master Budget for the year 2020 (CORONA virus year). You need to calculate your own production cost (raw material cost + labor cost + MOH cost) and opening/closing inventory. Show details/breakdown of your calculation.

Give reasons of any changes of you assumptions between 2019 and 2020 Master Budget i.e., pre COVID 19 situation and during COVID 19 situation. Also keep in mind that due to COVID 19 situation, the growth rate may be different than what has been observed during the normal scenario (mentioned above).

Step by Step Solution

There are 3 Steps involved in it

Step: 1

blur-text-image

Get Instant Access to Expert-Tailored Solutions

See step-by-step solutions with expert insights and AI powered tools for academic success

Step: 2

blur-text-image

Step: 3

blur-text-image

Ace Your Homework with AI

Get the answers you need in no time with our AI-driven, step-by-step assistance

Get Started

Recommended Textbook for

Access For Computer Accounting

Authors: Donna Kay

19th Edition

1259741109, 9781259741104

More Books

Students also viewed these Accounting questions

Question

Describe the typical grievance procedure.

Answered: 1 week ago

Question

What reward will you give yourself when you achieve this?

Answered: 1 week ago