BMAC5203 ACCOUNTING FOR BUSINESS DECISION MAKING

BMAC5203
ACCOUNTING FOR BUSINESS DECISION MAKING
JANUARY 2017
ASSIGNMENT 1
Submission Deadline (Two weeks following class discussion) __________________________________________________________________________________

INSTRUCTIONS TO STUDENTS

1. This assignment contains question that is set in English.

2. Answer in English.

3. Learners are to submit assignment only in MsWord (.docx) format unless specified otherwise. Please refrain from converting text / phrases into picture format such as .gif / .jpeg / print screen / etc.

4. Download the language version of the assignment template concerned from the myINSPIRE for preparation and submission of your assignment. Your assignment should be typed using 12 point Times New Roman font and 1.5 line spacing.

5. Your assignment should be between 3,000 words to 5,000 words excluding references. The number of words should be shown at the end of your assignment. Do not copy the assignment question and instructions to your answer.

6. You can submit your assignment ONCE only in a SINGLE file.

7. Your assignment must be submitted according to the due date.

8. Your assignment should be prepared individually. You should not copy another person’s assignment. You should also not plagiarise another person’s work as your own.

9. Please ensure that you keep the RECEIPT issued upon submisson of your assignment as proof of submission. Your assignment is considered as NOT submitted if you fail to produce the submission receipt in any dispute arises concerning assignment submission.


EVALUATION
This assignment accounts for 30% of the total marks for the course and shall be assessed based on the Rubrics attached.

You would be given feedback on the assignment before the Final Semester Examination commences.



PLAGIARISM: MARKS DEDUCTION

Warning: The submitted assignment will automatically undergo a similarity check. If plagiarism is detected, marks would be deducted as follows:

No. % Similarity Group % of Mark Deduction
1 0 – 30 0

2 30.01 – 50 5
3 50.01 – 70 10
4 70.01 – 100 100






































ASSIGNMENT 1 : QUESTION


Objective How organisations strive to achieve their financial goals by preparing a number of budgets that together form an integrated business plan known as the master budget. This question tests the ability to prepare a number of separate but interdependent budgets that formally lay out the company’s sales, production, and financial goals. It culminates in a cash budget, a budgeted income statement, and a budgeted balance sheet.
Marks allocated 30 marks

Nusajaya Sdn. Bhd. is preparing budgets for the quarter ending September 30. Related information is shown as below:

1. Budgeted sales for the next few months are:

Month Units
May 15,000
June 20,000
July 30,000
August 40,000
September 50,000
October 35,000
November 25,000


2. The selling price is $12 per unit.

3. All sales are on credit and the collection methods are:
i. 50% collected in the month of sales
ii. 30% collected in the month following sales
iii. 20% collected in two month following sales

4. The management at Nusajaya Sdn. Bhd. determines the ending inventory in units to be equal to 20% of the following month’s budgeted sales.

5. To produce one unit of output, 2 kilograms of direct material are needed.

6. Nusajaya decides to have direct materials on hand at 10,000 kilograms every month

7. Cost of direct material is estimated at $1.50 per kg.

8. The payment of direct materials is below:
i. 50% purchases is paid in the month of purchase
ii. 50% purchases is paid in the following month of purchase

9. To produce one unit of output, 0.1 hours of direct labor are required.

10. Nusajaya pays $8 per hour to its direct labor.

11. All wages are paid at the end of the month.

12. Manufacturing is divided into variable and fixed overhead.

13. Variable overhead is applied to each unit of output on the basis of direct labor hours.

14. The variable overhead rate is $10 per direct labor hour.

15. Fixed overhead is estimated at $40,000 per month.

16. Ending Finished Goods Inventory is made up from direct material, direct labor and manufacturing Overhead.

17. Cost of Goods Sold is computed based on the unit production cost of $5.79 per unit.

18. Selling and administrative cost is divided into variable and fixed components.

19. Variable selling and administrative cost is estimated at $1.50 per unit sold.

20. Fixed selling and administrative cost is estimated at $50,000 per month, where $5,000 is the depreciation and it is not a cash expense.

21. Nusajaya has the following cash policy :
i. Minimum cash balance of $50,000 is required for every month.
ii. Any deficiency of cash will be covered by loans with repayment in the following month.
iii. The interest on loan is charged at 15% per year.
iv. Purchased an equipment in August totalling $150,000.
v. Cash balance on 1 July is $55,000.

22. Nusajaya’s account balances are as follows:

$
Property 458,047.50
Equipment 150,200 (net)
Ordinary Shares 500,000
Retained earnings 335,777.50

Required:

To prepare the master budget (sales budget up to budgeted Statement of Financial Position) for Nusajaya Sdn. Bhd. for July, August and September.