Act202-project final. tea stall.docx

8/17/2019 Act202-project final. tea stall.docx

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1

Grou roect

Master Budget of “A Tea

Stall”


2/17

Spring - 2016

Course: Act-202

Section – 22

Submitted to:

Mr.

Lecturer

Department of Accounting & Finance,

North South University.

Submitted by:

Ashab Abi Sha 1!"#1$%##

M. A'if 'han 1!"1###

Saifur (ahman 1!"11!)##

Aniruha Sen 1"11*!$#

Date+ #%.#!.1$

Table of Content

Serial Contents Page

Numbers1 Introduction 4

2 Letter of Submission 5


3/17

3 Executive Summar 6

4 Sales Budget 7

5 !roduction Budget 9

6 "irect Materials Budget 10

7 "irect Labor Budget 12

8 Manufacturing #ver$ead Budget 13

9 Ending %inis$ed &oods inventor Budget 14

10 Selling and Administrative Budget 15

11 Cas$ Budget 16

12 Budgeted Income Statement 18

13 Budgeted Balance S$eet 19

14 'eferences 20

Introduction

A-auin ea Sta--/ is one of the most popu-ar tea

sta-- in 0ashunhara (A. 2t is a sma-- business

o3ne by a person name A-auin. 2t is situate

behin Apo--o 4ospita-s near Dutch 0ang-a 0an'5s

6atara 0ranch. After eviction of i--ega- footpath tea


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sta--s by po-ice this sta-- has become one of the

ma7or tea sta-- in that area. 8veryay a-- most three

hunre peop-e come to this sta-- to rin' tea. he

o3ner open the sta-- at $ a.m. an c-ose it aroun1" a.m. he sta-- is genera--y run by its o3ner an

an emp-oyee 3ho 3or's uner him. A-ong 3ith tea

there biscuits, brea an cigarettes avai-ab-e. As

this sta--s popu-arity is increasing ay by ay some

other tea sta-- o3ners have remove their sta--

from that p-ace. As a resu-t, A-auin ea Sta--/ isoing an e9ce--ent business out there. hat5s 3hy

3e prepare this pro7ect on that on the basis of

that sta--.

Letter of Submission

(especte Sir,


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2t is been a great p-easure for us to submit this

pro7ect on Master 0ugeting of a sma-- business.

his report has been prepare by a group of !

peop-e as a part of this course. :e have trie ourbest to imp-ement our -earning from this course. 2t

is prepare after oing some research an

gathering information. :e trie to inc-ue a-- the

re;uire information in this report. :e 3ou- -i'e to

than' you for giving us an opportunity to survey,

ana-y


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number of separate but inepenent bugets that

forma--y -ay out the businesses sa-es, prouction, an

=nancia- goa-s. he master buget cu-minates in a cash

buget, a bugete income statement, an a bugeteba-ance sheet. At =rst, 3e i sa-es buget 3hich

contains the sta--5s e9pecte sa-es. hen, 3e i

prouction buget 3hich contains the number of the

sta--s estimate prouction. After that, 3e prepare the

irect materia-s buget 3hich contains the estimation of

future irect materia-s. hen, 3e i irect -abor buget

3hich sho3s the irect -abor hours re;uire to satisfy the

prouction buget. Later, 3e prepare manufacturing

overhea buget 3hich -ists a-- costs of prouction other

than irect materia-s an irect -abor. hen, 3e

ca-cu-ate the ening =nishe goos inventory buget

3hich gives us a-- the ata to compute unit prouct cost.

After comp-eting that, 3e ca-cu-ate the se--ing an

aministrative buget 3hich gives bugete e9penses for

areas other than manufacturing. hen, 3e prepare the

cash buget, 3hich is compose of four ma7or sections.

After that, 3e prepare the bugete income statement

3hich is 3hich sho3s the revenues, e9penses an

income. At -ast, 3e prepare the bugete ba-ance sheet

3hich estimates the businesses assets -iabi-ities an

stoc'ho-er5s e;uity.

"vervie# of $ster %udget


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Sales Budget:

he master buget consists of a number of inepenent bugets

that forma--y -ay out the company5s sa-es, prouction an

=nancia- goos. he master buget cu-minates in a cash buget,a bugete income statement an bugete ba-ance sheet.

Sa-es 0uget+ he =rst step in the bugeting process is the

preparation of sa-es buget 3hich is a etai-e scheu-e sho3ing

the e9pecte sa-e for the buget perio. 2n a sa-es buget, 3e get

bugete units sa-es, bugete se--ing price per unit an

accounts receivab-e 3i-- be co--ecte as fo--o3s.

Alauddin Tea StallSales Budget

%or t$e (ear Ended "ecember )*+ ,-*.

Quarter 1 Quarter 2 Quarter 3 Quarter 4 Y

d unit 27000 25000 30000 26000 10

price per 6 6 6 6

ales 162000 150000 180000 156000 64

Ex/ected Cas$ Collection

g A/ 60000 6

ter sales 145800 16200 16

ter sales 135000 15000 15

ter sales 162000 18000 18


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ter sales 140400 14

s"

n

205800 151200 177000 158400 6#

Cas$ collection from last ear0s fourt$ 1uarter

sales:

1$"###>?#@ 1$"###>1#@

1%####>?#@ 1%####>1#@

1)####>?#@ 1)####>1#@

1%$###>?#@ Unco--ecte fourthB;uarter sa-es 1%$##.

!roduction Budget:

he prouction buget is prepare after the sa-es buget. he

prouction buget -ists the number of units that must beprouce to satisfy the sa-es nees an to provie for the esire

ening =nishe goos inventory.

Alauddin Tea Stall

!roduction Budget


Quarter 1 Quarter 2 Quarter 3 Quarter 4

d unit 27000 25000 30000 26000 1

units o& 5000 6000 5200 4100


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eds 32000 31000 35200 30100 1

& B()* 3500 5000 6000 5200

on in units

28500 26000 2#200 24#00 1

3enty percent of ne9t ;uarter5s sa-es. For e9amp-e, the secon

;uarter sa-es are "%### units. herefore the esire ening

inventory of =nishe goos for the =rst ;uarter 3ou- be

"#@>"%### C %### units. he beginning inventory in each

;uarter is the same as the prior ;uarters ening inventory.

"irect Material Budget:

A irect materia-s buget is prepare after the prouction

re;uirements have been compute. his buget etai-s the ra3

materia-s that must be purchase to fu-=-- the prouction buget

an to provie for ae;uate inventories.

Alauddin Tea Stall

"irect Materials Budget



,nit

n

28500 26000 2#200 24#00 10

. needed 4 4 4 4

needed 114000 104000 116800 ##600 43

d units '.* 10400 11680 ##60 8500 8

ts o& . 124400 115680 126760 108100 44

& B.* 7200 10400 11680 ##60 7

. to e 117200 105280 115080 #8140 43


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d

. per unit 05 05 05 05

. to e

d

58600 52640 57540 4#070 2

1#@ of the ne9t ;uarter5s prouction nees. For e9amp-e, the

seconB;uarter prouction nees are 1#!###. herefore, the

esire ening inventory for the 1st ;uarter 3ou- be

1#@>1#!###C1#!##.

Ex/ected Cas$ "istribution

A/- 60000 60000

r purc"ases 2#300 2#300 58600

er purc"ases 26320 26320 52640

er purc"ases 28770 2877# 57540

r purc"ases 24535 24535

"

ent &or

8#300 55620 550#0 53305 253315

Cas$ /aments for last ear0s fourt$21uarter

/urc$ases:

%)$##>%#@ %)$##>%#@

%"$!#>%#@ %"$!#>%#@

%*%!#>%#@ %*%!#>%#@"!%%>%#@. Unpai !th ;uarter purchases.

"irect Labor budget:


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oduct cost per cup9 4#4

d &inis"ed goods

:=

units 4100

oduct cost 4#4

dollars 202463

Selling and Administrative Ex/ense Budget:

he se--ing an aministrative e9pense buget -ists the bugete

e9penses for areas other than manufacturing. 2n -arge

organi


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he cash buget is compose of four ma7or sections+

1 he receipts section.

" he isbursements section. he cash e9cess or e=ciency section.

he =nancing section of the cash buget etai-s the borro3ings

an principa- an interest repayments pro7ecte to ta'e uring

the buget perio. he cash ba-ances at both the beginning an

en of the year may be ae;uate-y even though a serious cash

e=cit occurs at some point uring the year. he isbursementssection of the cash buget inc-ues some types of cash

isbursements. he ening cash ba-ance foe each perio is

compute by ta'ing the e9cess of cash avai-ab-e over

isbursements p-us the tota- =nancing.

Alauddin Tea Stall

Cas$ Budget

%or t$e ear ended "ecember )*+ ,-*.


cas" alance 350000 243700 142160 56720 35

ceipts


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tions &ro

stoer

162000 150000 180000 156000 64

" A>ailale 512000 3#3700 322160 212720 ##

urseents

%. 118600 111240 110180 106610 50

% 68400 62400 70080 5#760 26

. 21400 20400 21680 1##60 3

ing and

nistrati>e

5###0 57500 63500 58700 23

"

ents

268300 251540 265440 245030 10

cas"

o>er

ents

243700 142160 56720 +32310 +4

o?ingsAts o& !uarter9

a:ents 80000 8

terest

ancing 80000 8

s" alance 243700 142160 56720 516#0 5

Budgeted Income Statement:

A-- of the revenues an income statement sho3n on the bugete

income statement comes from the in the beginning ba-ancesheet.

Alauddin Tea Stall

Budgeted Income Statement


Sales 64800

+ ost o& goods sold 32400

)ross .argin 32400

+ Selling and adinistrati>e epenses 20152

@et operating incoe 12248


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+*nterest epense 17#8

@et incoe 12068

Budgeted Balance S$eet:

he bugete ba-ance sheet is eve-oping using ata from the

ba-ance sheet from the beginning of the buget perio an atacontaine in the various scheu-es.

Alauddin Tea Stall

Budgeted Balance S$eet

"ecember )*+ ,-*.

Assets

urrent assets=

as" 176#0

Accounts recei>ale 46800

a? aterials in>entor: 4250

(inis"ed goods in>entor: 20246

Total current assets

and and e!uipent=

and 20000

'!uipent 5000

@et land and e!uipent

Total assets

iailities=

Accounts pa:ale 1367832

etained earnings 100030868

Total liailities


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&eferences:

1 A-auin ea Sta--" Manageria- Accounting, 1%th 8ition by Earrison, Noreen an

0re3er. 2nvesotpeia.com

Documents

Act202-project final. tea stall.docx