The following details have been taken from the books of ABC Company Limited for the year ended
Question:
The following details have been taken from the books of ABC Company Limited for the year ended 30th June 2022.
TZS | TZS | |
Sale | 136,000,000 | |
Direct materials | 40,000,000 | |
Direct wages | 28,000,000 | |
Direct expenses | 2,000,000 | |
Factory overheads | 14,000,000 | |
Administration overheads | 16,800,000 | |
Selling overheads | 12,600,000 | 113,400,000 |
Profit | 22,680,000 |
59% of factory overhead and 60% of selling overheads are analyses as variable. The forecast for the next year ending 30th June 2003 is as follows:-
Sales volume will increase by 30% but the selling price will be reduced by 5%
The prices of raw materials will remain unchanged but because of increased purchases, a quantity discount of 5% will be obtained.
Variable overheads (selling and factory), direct wages and expenses will increase in proportion of sales volume
Wages and Factory Overheads (variable only) will go up by a further 10% due to an increase in rates.
Administration overheads will decrease by 2%
These will be no stock of work in progress and finished goods in the beginning or end of the year.
Required
Prepare a budgeted income statement of ABC Company for the next year ending 30th June 2023.
Intermediate Accounting IFRS
ISBN: 9781119607519
4th Edition
Authors: Donald E. Kieso, Jerry J. Weygandt, Terry D. Warfield