Profog limited
“Question 5 (25 marks)
Profog Limited is a manufacturing company busy preparing its monthly budgets. The company
produces and sells one product. Budgeted sales for the coming months are as follows:
June July August September
Budgeted sales (units) 5,000 6,000 7,000 2,000
The budgeted selling price is €200 per unit. 30% of sales are for cash, 50% pay one month later
and the remainder the following month. Debtors of €100,000 at the beginning of May are due to
pay €60,000 in June and the balance in July. Customers who avail of the cash sales are entitle to
2% cash discount.”
“Total cost
per unit
40+28+67.46= 50+21+61.81= 30+14+57.35
135.46 132.81 =101.35
140.43 c)
Traditional
Profog Limited
Difference
RM148
RM135.46
148-135.46
=RM12.54
RM131
RM132.81
131-132.81=
(RM1.81)
RM84
RM101.35
84-101.35
=(RM17.35)
60+21+59.43=
RM141
RM140.43
141-140.43
=RM0.57
Labor hours
Percentage (%)
No of inspection
:
Direct labor
“Product X
Product Y
Product Z
Total production cost
28*1.5*750=31,500
28*1*1,250=35,000
28*3*7,000=588,000
654,500
Set up cost
654,500*35%=229,075 Machinery cost
654,500*20%=130,900
Material handling
654,500*15%=98,175
Inspection
654,500*30%=196,350
Total
654,500
Total machine hour
3*7000=
Total
“Production rate Profog Limited”
“Product X
Conventional
65
Profog Limited 117.95
Difference
65-117.95
=(RM52.95)
Operation activity
Product Y
49
100.06
49-100.06
=(RM51.06)
Product Z
115
100.2
115-100.2
=RM14.8
Opening stocks
Gross profit
P/L depreciation
Total
Total
P/L depreciation
Total
\
Total
Total
Total
Total
Total
Increase in C/stk
Sales of fixed assets
Issue new LT debt
Total
Total
Total
Total
Total
Total
Total
Total
Total
Total
Total
Total
Fixed assets
Total
Total
“Increase in inventory (46-15)
Name:
Description:
…
