The Garden Ornament Company manufactures two types of garden ornament: a duck and a heron. The information presented in Tables T 1 to T 5 has been prepared, as a result of discussions by line managers,= for the purposes of preparing a master budget for Year 6.

Sales and production volumes and direct costs
(T 1)

Direct labour costs are based on an average cost of £15,000 per person per year.

Other costs
(T 2)

Working capital targets
(T 3)

Sales and purchases are planned to be spread evenly over the year.

Capital budget plans
(T 4)

Purchase one new moulding machine at £70,000, at the start of the year. Depreciate all machinery for a full year at 20% per annum on a straight-line basis.

Balance sheet at 31 December Year 5
(T 5)

Required

Prepare a master budget and all supporting budgets.

Transcribed Image Text:

Ducks Herons Unit sales for the year 8,000 15,000 Unit selling price 30 45 Unit variable cost: Direct material 14 16 Direct labour 12 13