QUESTION 1

Eco frame Ltd

Sales Budget
Current year
4th
1st
2nd
quarter
quarter
Quarter
S frame unit sales
50,000
55,000
60,000
x S sales price
10
10
10
S frame sales revenue
500,000
550,000
600,000
L frame unit sales
40,000
45,000
50,000
x L frame sales revenue
15
15
15
600,000
675,000
750,000
Total sales revenue
1,100,000 1,225,000
1,350,000
Cash sales*
Credit sales**
*40% of total sales
**60% of total sales

240,000
360,000

270,000
405,000

300,000
450,000

Budget year
3rd
4th
Entire
Quarter
Quarter
year
65,000
70,000
250,000
10
10
40
650,000
700,000 2,500,000
55,000
60,000
210,000
15
15
60
825,000
900,000 3,150,000
1,475,000 1,600,000 5,650,000
330,000
495,000

360,000
540,000

1,260,000
1,890,000

QUESTION 2
Eco frame Ltd
Sales Budget
Current year

Cash Sales
Cash receipt from credit sales made during
current quarter*
Cash receipt from credit sales made during
previous quarter**
Total cash receipt
*80% of current quarter's credit sales
**20% of previous quarter's credit sales

Budget year
1st
2nd
3rd
4th
Entire
quarter Quarter Quarter Quarter year
270,000 300,000 330,000 360,000 1,260,000
324,000 360,000 396,000 432,000 1,512,000
72,000

81,000

90,000

99,000

108,000

666,000 741,000 816,000 891,000 2,880,000

QUESTION 3
Production Budget
Current year
4th
quarter
S frame
Sales (in units)
Add : Desired ending inventory
Total units needed
Less : Expected beginning
inventory
Units to be produced
L frames
Sales (in units)
Add : Desired ending inventory
Total units needed
Less : Expected beginning
inventory
Units to be produced

1st
quarter

2nd
Quarter

Budget year
3rd
4th
Quarter
Quarter

Entire
year

50,000
11,000
61,000

55,000
12,000
67,000

60,000
13,000
73,000

65,000
14,000
79,000

70,000
50,000
120,000

250,000
0
250,000

0
61,000

11,000
56,000

12,000
61,000

13,000
66,000

14,000
106,000

50,000
200,000

40,000
9,000
49,000

45,000
10,000
55,000

50,000
11,000
61,000

55,000
12,000
67,000

60,000
42,000
102,000

210,000
0
210,000

0
49,000

9,000
46,000

10,000
51,000

11,000
56,000

12,000
90,000

42,000
168,000

QUESTION 4
EcoFrame Ltd
Direct Materials Budget
Current year
4th
quarter
Metal Strips
S frames to be produced
x quantity per unit (metres)
Qty needed for S frame
production
L frames to be produced
x quantity per unit (metres)
Qty needed for L frame
production
Total metal needed for
production (metres)
x price per metre
Cost of metal strips to be
purchased
Glass sheets
S frames to be produced
x glass quantity per unit
(sheets)
Qty needed for S frame
production
L frames to be produced
x glass quantity per unit
(sheets)
Qty needed for L frame
production
Total glass needed for
production
Add : desired ending
inventory
Total glass needed
Less : Expected beginning
inventory
Glass to be purchased
x price per glass sheet
Cost of glass to be purchased
Total direct material
purchases (metal and glass)

61,000
2/3

1st
quarter
56,000
2/3

2nd
Quarter
61,000
2/3

Budget year
3rd
4th
Quarter
Quarter
66,000
2/3

Entire
year

106,000
2/3

289,000
3

40,666.67 37,333.33 40,666.67 44,000.00 70,666.67

49,000
46,000
51,000
56,000
90,000
1
1
1
1
1

192,667
243,000
4

49,000

46,000

51,000

56,000

90,000

243,000

89,667
3

83,333
3

91,667
3

100,000
3

160,667
3

435,667
12

269,000

250,000

275,000

300,000

482,000 1,307,000

61,000

56,000

61,000

66,000

106,000

289,000

1/4

1/4

1/4

1/4

1/4

15,250
49,000

14,000
46,000

15,250
51,000

16,500
56,000

26,500
90,000

72,250
243,000

1/2

1/2

1/2

1/2

1/2

24,500

23,000

25,500

28,000

45,000

121,500

39,750

37,000

40,750

44,500

71,500

193,750

16,667
56,417

18,333
55,333

20,000
60,750

32,133
76,633

10,400
81,900

80,867
274,617

18,333
38,083
8
304,667

20,000
35,333
8
282,667

32,133
28,617
8
228,933

10,400
66,233
8
529,867

80,867
143,400
1,033
131,217
8
32
8,267 1,049,733

573,667

532,667

503,933

829,867

490,267 2,356,733

QUESTION 5
Eco Frame Ltd
Cash Payments Budget
Current year

Direct Material purchases

Cash payments for purchases during the
current quarter
Cash payments for purchases during the
preceding quarter
Total cash payments for direct material
purchases
Direct Labour
Frames produced (S and L)
x direct labour hours per frame
Direct Labour hours
x rate per direct labour hour
Total Cash payments dor direct labour
Manufacturing Overhead
Indirect Material
Indirect labour
Other
Total cash payments for manufacturing
overhead
Cash payments for selling and administrative
expenses
Total cash payments

Budget year
3rd
4th
Quarter
Quarter

1st
quarter

2nd
Quarter

426,133

403,147

663,893

392,213 1,885,387

114,733

106,533

100,787

165,973

540,867

509,680

764,680

558,187 2,373,413

110,000
0.10
11,000
20
220,000

102,000
0.10
10,200
20
204,000

112,000
0.10
11,200
20
224,000

122,000
0.10
12,200
20
244,000

446,000
0.40
44,600
80
892,000

10,200
40,800
31,000

11,200
44,800
36,000

12,200
48,800
41,000

13,200
52,800
46,000

46,800
187,200
154,000

82,000

92,000

102,000

112,000

388,000

100,000
942,867

Entire
year

488,027

100,000
100,000
100,000
400,000
905,680 1,190,680 1,014,187 4,053,413

QUESTION 6
EcoFrame Ltd
Cash Budget
Current year

Cash receipts (from schedule 2)

Less : Cash payments (from schedule 5)
Change in cash balance due to operations
Payment of dividens
Proceeds from bank loan (January)
Purchase of equipment
Quarterly installment on loan principal
Quarterly interest payment
Change in cash balance during the period
Cash balance, beginning of period
Cash balance, end of period

Budget year
1st
2nd
3rd
quarter
Quarter
Quarter
666,000
741,000
816,000
942,867
905,680 1,190,680
(276,867)
(164,680) (374,680)
50,000
50,000
50,000
1,000,000
1,000,000
275,000
275,000
275,000
25,000
25,000
25,000
600,000
75,000
75,000
600,000
675,000
675,000
750,000

4th
Quarter
Entire year
891,000
2,880,000
1,014,187
4,053,413
(123,187) (1,173,413)
50,000
50,000

275,000
25,000
75,000
750,000
825,000

275,000
25,000
75,000
825,000
900,000

QUESTION 7
Budgeted Schedule of Cost of Goods
Manufactured and Sold

Current year

Direct Materials Purchases - Glass

Sheet
Direct Materials Purchases - Metal
Strip
Beginning Direct Material
Less: Ending direct material
Direct Material Cost
Direct Labor Cost
Manufacturing Overhead
Total Manufacturing Cost
Beginning Work in Process
Less : Ending Work in Process
Budgeted Cost of Goods
Manufactured

EcoFrame Ltd
Cost of Goods Manufactured Budget
Budget year
4th
1st
2nd
3rd
4th
quarter quarter Quarter
Quarter
Quarter

Entire
year

304,667

282,667

228,933

529,867

8,267 1,049,733

269,000
18,333
16,667
608,667

250,000
20,000
18,333
571,000
220,000
82,000
873,000
0
0

275,000
300,000
32,133
10,400
20,000
32,133
556,067
872,400
204,000
224,000
92,000
102,000
852,067 1,198,400
0
0
0
0

482,000 1,307,000
80,867
143,400
10,400
80,867
581,533 2,581,000
244,000
892,000
112,000
388,000
937,533 3,861,000
0
0
0
0

873,000

852,067 1,198,400

937,533 3,861,000

Cost of Goods Manufactured Sold

Current year

Direct Materials Used (Metal Strip)

Direct Materials Used (Glass Sheet)
Direct Labor Used
Overhead
Budgeted Manufacturing Costs
Beginning Finished Goods (Sframe)
Beginning Finished Goods (LFrame)
Goods Available for sale
Less : Ending Finished Goods (SFrame)
Less : Ending Finished Goods (LFrame)
Budgeted Cost of Goods Sold

Budget year
4th
1st
2nd
3rd
4th
quarter quarter Quarter
Quarter
Quarter
89,667
83,333
91,667
100,000
160,667
56,417
55,333
60,750
76,633
81,900
220,000 204,000
224,000
244,000
892,000
82,000
92,000
102,000
112,000
388,000
448,083 434,667
478,417
532,633 1,522,567
13,000

14,000

Entire
year
435,667
274,617
1,564,000
694,000
2,968,283

11,000

12,000

50,000

9,000
454,667

10,000
500,417

12,000

13,000

14,000

50,000

89,000

10,000

11,000

12,000

42,000

75,000

432,667

476,417

11,000
12,000
42,000
556,633 1,548,567 3,060,283

530,633 1,456,567 2,896,283

QUESTION 8
EcoFrame's
Budgeted Income Statement for the year ended 31 December
RM
Sales Revenue

RM
5,650,000

Less : Variable Cost

-Direct Labour
-Direct Materials

892,000
2,356,733

3,248,733

Less : Manufacturing cost

388,000

388,000

Less : Administrative expenses

400,000

400,000

Net Profit

1,613,267

QUESTION 9
EcoFrames
Budgeted Balance sheets
RM
Asset:
Non-Current asset
Robot
Current Assets:
Cash
Account Receivable
Inventory :
Raw Material
Finished good

1,000,000

825,000
108,000
2,356,733
92,000

Total Assets
Account Payable
Loan from Bank 10%
retained earning
Suspend account
Total liabilities and shareholder's Equity

RM

3,381,733
4,381,733

1,653
1,100,000
1,613,267
1,666,813
4,381,733