Lodha & Co. manufactures two products, R & S. A forecast of the number of units to be sold in the first 7 months of a year is given as follows:
|
Months |
Product R units |
Product S units |
|
January |
1,000 |
2,800 |
|
February |
1,200 |
2,800 |
|
March |
1,600 |
2,400 |
|
April |
2,000 |
2,000 |
|
May |
2,400 |
1,600 |
|
June |
2,400 |
1,600 |
|
July |
2,000 |
1,800 |
It is anticipated that:
- There will be no WIP at the end of any month.
- Finished units equal to half the sales for the next month will be in stock at the end of each month.
- Budgeted Production and Production Cost for the whole Budgeted year are as follows:
|
|
Product R |
Product S |
|
Production |
22,000 units |
24,000 units |
|
Direct Materials per unit |
Rs. 12.50 |
Rs. 19.00 |
|
Direct Wages per unit |
Rs. 4.50 |
Rs. 7.00 |
|
Total Factory Overhead apportioned to each type of |
Rs. 66,000 |
Rs. 96,000 |
Prepare a Production Budget for each month and a summarized Production Cost Budget for the 6 months that ends on 30th June of the year.