Required:

Prepare budget:

the budget will include:

budgets for production,

use of materials budget,

procurement of materials budget,

labor costs budget,

sales budget,

purchases budget,

cost of sales budget

marginal income budgets

budgeted income statement

2) also prepare a flexible budget on production of 5000 units of

boat engine #1 and 1000 units of boat engine

(3.5 dollars )

Expected/planned cost for material A 3,5 $ per kg;

material B 5 $ per kg; direct labor 10 $ per hour.

Company produces 2 types of boat engines. It uses 2 types of materials A and B. The company uses direct costing system. It arranged development plan for the year as below: Expected planned sales: boat engine #1 - 2500 units by 300 per unit, boat engine # 2 - 500 units by 400 S per unit. Expected/planned inventory for the end of the period: for boat engine #1 - 550 units; for boat engine #2 - 25 units. Expected planned cost for material A-3,5 S per kg; material B-5 $ per kg; direct labor - 10 $ per hour. Direct costs to be included into cost of production Indicator beat engine 2 Material A6kg kg Material te Direct labore hours Expected planned materials stock for the end of the period: material A - 4000 kg; material B - 1000 kg. Expected/planned overheads Cost Amounts General production 280 000 Fixed 354000 including Depreciation 11 000 Salary of employee 2000 Admin offices 25 000 Rent & taxes 17 000 Electricity 33 000 Availability of materials and goods in warehouse of the company: material A-3500 kg, material B - 3000 kg; boat enginett - 50 units, boat engine#2 - 25 units. Required: Prepare budget: the budget will include: budgets for production, use of materials budget, procurement of materials budget, labor costs budget sales budget, purchases budget, cost of sales budget marginal income budgets budgeted income statement also prepare a flexible budget on production of 5000 units of boat engine #1 and 1000 units of boat engine #2