Saudi Rock Wool factory( SRWF), a Manufacture of thermal insulation products including wraps, boards, loose wool,...

  

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Saudi Rock Wool factory( SRWF), a Manufacture of thermal insulation products including wraps, boards, loose wool, blankets and roof slabs has the following budgeted unit sales for the next five-month period: Unit Sales Month July Aug Sep Oct Nov 45,000 60,000 105,000 75,000 90,000 a. The selling price of each pipe is SAR 10. b. Variable cost per unit is SAR 3 and monthly fixed cost is SAR 50,000. c. The cash collected 50% in cash and remaining 50%in the next month. Bad debts are negligible and can be ignored. The receivable at the end of July were SAR 150,000 d. There were 20,000 units of finished goods in inventory at the beginning of Aug. SRWF is planning are to have an inventory of finished products that equal 10% of the unit sales for the next month. e. Two piles of wool materials are required for each blanket produced. Each pile of wool material costs SAR 5. Inventory levels for materials are equal to 20% of the needs for the next month. Materials inventory on Aug 1 was 10,000 piles and at the end of October was 30,000 piles. f. Purchases are paid for 60% in the month of purchase and 40% in the following month. The ending balance of Accounts Payable at the end of July was SAR 15,000 g. The companies beginning cash balance of August was SAR 900,000. Insurance paid during the month Oct is SAR 10,000 h. Interest received in month of September SAR 6,000 i. Rent paid on machineries in month of October SAR 30,000. Required: 1. Prepare a sales budget & cash collection schedule for the quarter, August, September, October (5 points) 2. Prepare production budgets in units for the quarter, August, September , October (2 points) 3. Variable Over Head Manufacturing Cost Budget (2 points) 4. Prepare a materials & cash disbursement budget in pounds for the Quarter month August, September, and October and give total purchases in both pounds and SAR for each month. (3 points) 5. Prepare cash budget for the quarter, months of August, September and October. (3 points) Part -2 Saudi Rock Wool factory (SRWF) used the following data to evaluate their current operating system. The company sells items for SAR 30 cach and used a budgeted selling price of SAR 20 per unit. Actual Units sold Variable costs Budgeted 120,000 units SAR 1,500,000 SAR 1,300,000 100,000 units Fixed costs SAR 400,000 SAR 600,000 Required: 6. Prepare Static-Budget Variance Analysis (3 points) Saudi Rock Wool factory( SRWF), a Manufacture of thermal insulation products including wraps, boards, loose wool, blankets and roof slabs has the following budgeted unit sales for the next five-month period: Unit Sales Month July Aug Sep Oct Nov 45,000 60,000 105,000 75,000 90,000 a. The selling price of each pipe is SAR 10. b. Variable cost per unit is SAR 3 and monthly fixed cost is SAR 50,000. c. The cash collected 50% in cash and remaining 50%in the next month. Bad debts are negligible and can be ignored. The receivable at the end of July were SAR 150,000 d. There were 20,000 units of finished goods in inventory at the beginning of Aug. SRWF is planning are to have an inventory of finished products that equal 10% of the unit sales for the next month. e. Two piles of wool materials are required for each blanket produced. Each pile of wool material costs SAR 5. Inventory levels for materials are equal to 20% of the needs for the next month. Materials inventory on Aug 1 was 10,000 piles and at the end of October was 30,000 piles. f. Purchases are paid for 60% in the month of purchase and 40% in the following month. The ending balance of Accounts Payable at the end of July was SAR 15,000 g. The companies beginning cash balance of August was SAR 900,000. Insurance paid during the month Oct is SAR 10,000 h. Interest received in month of September SAR 6,000 i. Rent paid on machineries in month of October SAR 30,000. Required: 1. Prepare a sales budget & cash collection schedule for the quarter, August, September, October (5 points) 2. Prepare production budgets in units for the quarter, August, September , October (2 points) 3. Variable Over Head Manufacturing Cost Budget (2 points) 4. Prepare a materials & cash disbursement budget in pounds for the Quarter month August, September, and October and give total purchases in both pounds and SAR for each month. (3 points) 5. Prepare cash budget for the quarter, months of August, September and October. (3 points) Part -2 Saudi Rock Wool factory (SRWF) used the following data to evaluate their current operating system. The company sells items for SAR 30 cach and used a budgeted selling price of SAR 20 per unit. Actual Units sold Variable costs Budgeted 120,000 units SAR 1,500,000 SAR 1,300,000 100,000 units Fixed costs SAR 400,000 SAR 600,000 Required: 6. Prepare Static-Budget Variance Analysis (3 points)

Answer rating: 100% (QA)

July Aug Sep Oct Nov Sales units 45000 60000 105000 75000 90000 Sales 10 pu 450000 600000 1050000 75... View the full answer