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Term Project

ACT 202 Section 11 Semester - Summer 2012

Submitted To : RakibulHasan (Rkb)

Submitted By: GirirajSaha Id 1130267030 M MNasir Id 1110414030 MushfiqurRahmanFarazi Id 1130007030

A Master Budget for a manufacturing local store (Dokan)

Fuchka Vendors

Acknowledgement

First and for most we would like to pass our heartfelt thanks to the Almighty God for giving us the strength and encouragement to do the overall assignment. Secondly, we are gratefully acknowledging our course teacher Mr. RakibulHasan for his comments, feedback, direction, encouragement, support and guidance throughout the study. Without his help, our assignment would have not been conducted in time and in proper procedure. All the information collected for this assignment was accumulated from the interviews conducted by the group members, text books and the internet. We thank the Vendor for His valuable time and helping us providing the required information and queries. Last but not the least, this work of assignment would not be completed without the studies, provided by the lecturers of North South University (NSU). Team Members: GirirajSaha Id 1130267030 M MNasir Id 1110414030 MushfiqurRahmanFarazi Id 1130007030

Letter of Transmittal
RakibulHasan (Rkb) ACT202 School of Business North South University Subject: Submission of the assignment on A Master Budget for a manufacturing local store (Dokan) Sir, We submit here the assignment of our Group which you have asked for and assigned us to prepare by following the established layout of a formal project. With a view to accomplishing the partial requirement of the course ACT202for the semester we are submitting this report to you on 6th August, 2012. Its a great pleasure for us to have the opportunity to prepare this Project on A Master Budget for a manufacturing local store (Dokan). It has been a great experience for us to work with such a topic. In our report we tried to fulfil the requirements provided by your guidelines. We tried our maximum to make it interesting but at the same time a presentable report. Thank you for your sincere & honest efforts to make us familiar with the terms & facts of ACT202 which helped us prepare the paper a successful one. Our efforts will be valued, if this project can serve for what its been meant for & our assistance will be there for any queries. Sincerely yours, Team Members: M MNasir GirirajSaha MushfiqurRahmanFarazi

Table Of Contents
SL.No Topic
01 02 03 04 05 06 07 08 09 10 11 COVER PAGE TITLE PAGE ACKNOWLEDGEMENT LETTER OF TRANSMITTAL EXECUTIVE SUMMARY SALES BUDGET; EXPECTED CASH COLLECTION PRODUCTION BUDGET; OPERATING EXPENSE BUDGET DIRECT MATERIALS BUDGET; CASH DISBURSEMENT FOR DIRECT MATERIAS PURCHASE CASH BUDGET; INCOME STATEMENT BALANCE SHEET

Page
01 02 03 04 06 07 08 09 10 11 12

REFERENCE

Executive Summary

Bangladesh is a land of cultural heritages and ceremonies so our Bengali calendar is enriched with ceremonies and festivals. People in Bangladesh love to roam around and eat while they gossip around with friends during these festivals. One of the most popular street foods is Fuchka and people loves to eat it while they hang around with friends, family or with a date. The street food industry has an important role in the cities and towns of many developing countries in meeting the food demands of the urban dwellers. It feeds millions of people daily with a wide variety of foods that is relatively cheap and easily accessible. It also generates employment to a significant group in the citys informal sector. Most of the food vendors are illiterate and cannot write their names and have no formal education. As street food business requires low investment, most of the vendors own the business. We interviewed a local Fuchka street vendor who lives in Rayer Bazar and sells roaming around in a van in Dhanmondi. He usually doesnt keep records of all his costs, he only maintains how much he has spend on a day and how much cash at the end of the day he has received. So we tried our best to gain as much details as possible from him and prepared this master budget. He works for 13-18 hours a day and his daily average net income was up to TK. 904.00 as per our master budget plan.

7 SALES BUDGET QUARTER 1 Budgeted sales Selling price/unit (tk) Total sales (tk) 3000 30 90000 2 2500 30 75000 3 3500 30 105000 4 2000 30 60000 . YEAR 11000 30 330000

Percentage of sales collected in the period of the sale 95% Percentage of sales collected in the period after the sale 3% Percentage of sales uncollected 2%

EXPECTED CASH COLLECTION QUARTER 1 BEGINNING BALANCE 1ST QUARTER COLLECTION 2ND QUARTER COLLECTION 3RD QUARTER COLLECTION 4TH QUARTER COLLECTION TOTAL CASH COLLECTION 87450 73950 102000 1950 85500 2700 71250 2250 99750 3150 57000 60150 2 3 4 . YEAR 1950 88200 73500 102900 57000 323550

8 PRODUCTION BUDGET QUARTER 1 BUDGETED SALES Add: DESIRED ENDING INV. OF FINISHED GOOD TOTAL NEED Less: BEGINNING INV. OF FINISHED GOOD REQUIRED PRODUCTION 3000 2 2500 3 3500 4 2000 . YEAR 11000

0 3000

0 2500

0 3500

0 2000

0 11000

0 3000

0 2500

0 3500

0 2000

0 11000

OPERATING EXPENSE BUDGET QUARTER 1 BUDGETED SALES VARIABLE SELLING EXPENSE PER UNIT TOTAL VARIABLE EXPENSE FIXED EXPENSE: DEPRICIATION TOTAL EXPENSE Less: DEPRICIATION CASH DISBURSEMENTS FOR OPERATING EXPENSE 3000 2 2500 3 3500 4 2000 . YEAR 11000

9 27000

9 22500

9 31500

9 18000

9 99000

3000 30000 3000 27000

3000 25500 3000 22500

3000 34500 3000 31500

3000 21000 3000 18000

12000 111000 3000 99000

9 DIRECT MATERIALS BUDGET QUARTER 1 REQUIRED PRODUCTION RAW MATERIALS NEEDED (KG) PRODUCTION NEEDS (KG) Add: DESIRED ENDING INV. OF RAW MATERIALS TOTAL NEEDS Less: BEGINNING INV. OF RAW MATERIALS RAW MATERIALS TO BE PURCHASED COST OF RAW MATERIALS PER KG (AVERAGE) COST OF RAW MATERIALS TO BE PURCHASED 3000 2 2500 3 3500 4 2000 . YEAR 11000

0.2 600

0.2 500

0.2 700

0.2 400

0.2 2200

50 650

70 570

40 740

50 450

50 2250

60 590

50 520

70 670

40 410

60 2190

85 50150

85 44200

85 56950

85 34850

85 186150

EXPECTED CASH DISBURSEMENTS FOR MATERIALS BEGINNING BALANCE 1ST QUARTER 2ND QUARTER 3RD QUARTER 4TH QUARTER TOTAL CASH DISBURSEMENT 53575 47175 50575 28500 25075 25075 22100 22100 28475 28475 17425 45900 28500 50150 44200 56950 17425 197225

50% PAID IN THE QUARTER OF PURCHASE AND RESTS ON THE FOLLOWING QUARTER.

10 CASH BUDGET QUARTER 1 BEGINNING CASH BALANCE EXP CASH COLLECTION TOTAL CASH AVAILABLE Less:CASH DISBURSEMENT DIRECT MATERIAL OPERATING EXPENSE EQUIPMENT PURCHASE TOTAL DISBURSEMENT CASH SURPLUS LOAN/BORROWING ENDING CASH BALANCE 53575 27000 2000 82575 9875 0 9875 47175 22500 0 69675 14150 0 14150 50575 31500 3425 85500 30650 0 30650 45900 18000 5000 68900 21900 0 21900 197225 99000 10425 306650 19950 0 19950 5000 2 9875 3 14150 4 30650 . YEAR 5000

87450 92450

73950 83825

102000 116150

60150 90800

321600 326600

INCOME STATEMENT FOR THE YEAR ENDED 31ST DECEMBER 2012

SALES REVENUE Less: COST OF GOODS SOLD (85 X 0.2 X 11000) GROSS MARGIN Less: OPERATING EXPENSE NET INCOME

330000 187000 143000 111000 32000

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BUDGETED BALANCE SHEET DECEMBER 31, 2012

ASSETS CURRENT ASSETS: CASH ACCOUNT RECEIVABLE RAW METARIAL INVENTORY (85 X 50) TOTAL CURRENT ASSETS PLANT AND EQIPMENT: CARRIAGE EQIPMENT (PLATES & SPOONS) PLANT AND EQIPMENT, NET TOTAL ASSETS 20000 5000 25000 51000 19950 1800 4250 26000

LIABILITIES AND STOCKHOLDERS EQUITY CURRENT LIABILITIES: ACCOUNTS PAYABLE (RAW METARIAL) LOAN TOTAL LIABILITIES AND STOCKHOLDERS EQUITY 17425 33575 51000

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REFERENCE

MANAGERIAL ACCOUNTING GARRISON; NOREEN; BREWER WWW.ACCOUNTING4MANAGEMENT.COM WWW.EHOW.COM SURVEY ON INDIRA ROAD, FARMGATE DATA BASED ON MAA FUCHKA GHAR