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6,000 Walsh Ltd Balance Sheet as at 31 December 20X4 Fued assets Depreciation Cost to date Ner E E Machinery 4.000 1.600 Motor vehicles 2.400 2009 800 1.200 2,400 3.600 Current assets Stocks: Finished goods 75 units) 900 Raw materials 500 Debtors (20X4 October 2540 - November 1350 - December 450) 1.350 Cash and bank balances 650 3,400 Less Current liabilities Creditors for raw materials November $120 - December 180) 300 Creditors for indirect manufacturing expenses (December 100 (_400) Net current assets 3.000 6,600 Financed by: Share capital: 4,000 shares 1 each 4.000 Profit and loss 2,600 6.600 The plans for the sex months. ended 30 June 20X3 are as follows: a Production will 60 units per month for the first four months, followed by 70 units per month for May and June (51 Production costs will be per unit Direct materials Direct labour Variable overhead Ici Fixed indirect manufacturin exences 100 per month. pavable always one month in arteses, di Sales, at a price of 18 per unit, are expected to be: January February March April May No. of units June 40 50 50 90 90 70 el Purchases of direct materials raw materials will be January February March April May une E 2 E E 150 200 250 300 400 320 The creditors for raw materials bought are paid two months after purchase. (3) Debors are expected to pay their accounts three months after they have bought the goods. 1) Direct labour and variable indirect manufacturing expenses are paid in the same month as the units are produced (1) A machine costing 2,000 will be bought and paid for in March. 13,000 shares of 1 each are to be issued a parin Hay Depreciation for the six months nachinery 450-motor vehicles 200. We must first of all draw up the various budgets and then incorporate them into the master budget. Some of the more detailed budgets which can be dispensed with in the illustration will be omnirred