Reference no: EM132659565
Selling price was BDT 15 per cupAverage Sales volume was 225 cup per dayAnnual sales growth was 15% You have a tea stall in operation at Ramna park since 2015. Information of your business in 2018 are as follows:
Price increases by 10% every year
Monthly average selling and administration cost of the stall was:
Police Commission = BDT 500/month
Rent = BDT 1,000/month
Utility = BDT 200/month
Depreciation = BDT 60/month
Salary (Production) = BDT 8000/ Month
Sales (sales + admin ) = BDT 10000/Month
During a normal situation, the following growth has been observed:
Raw material cost increases by 10% every year
Labor cost increases by 8% every year
MOH cost increases by 12% every year
Selling and administration cost increases by 4% every year
Problem 1: Make a Master Budget (Sales/Production/RM/Labor/MOH/Selling & Administrative/Cash budget) for the year 2019 (Pre CORONA virus year ) and another Master Budget for the year 2020 (CORONA virus year). You need to calculate your own production cost (raw material cost + labor cost + MOH cost) and opening/closing inventory. Show details/breakdown of your calculation.
Problem 2: Give reasons of any changes of you assumptions between 2019 and 2020 Master Budget i.e., pre COVID 19 situation and during COVID 19 situation